The old tax regime provides 3 slab rates for levy of income tax which are 5%, 20% tax rate and 30% for different brackets of income. The individuals have been given the option to continue with this Old tax regime and they can claim deductions of allowances like Leave Travel Concession (LTC), House Rent Allowance (HRA), and certain other allowances. Additionally, deductions for tax saving investments as per section 80C (LIC, PPF ,NPS etc) to 80U can be claimed. Standard deduction of Rs 50,000, deduction for interest paid on home loan.
Tax slab rates applicable for Individual taxpayer below 60 years for Old tax regime is as below:
|Income Range||Tax rate||Tax to be paid|
|Up to Rs.2,50,000||0||No tax|
|Between Rs 2.5 lakhs and Rs 5 lakhs||5%||5% of your taxable income|
|Between Rs 5 lakhs and Rs 10 lakhs||20%||Rs 12,500+ 20% of income above Rs 5 lakhs|
|Above 10 lakhs||30%||Rs 1,12,500+ 30% of income above Rs 10 lakhs|
There are two other tax slabs for two other age groups: those who are 60 and older and those who are above 80.A word of note: People often misunderstand that if they earn let’s say Rs.12 lakhs, they will be paying a 30% tax on Rs.12 lakhs i.e Rs.3,60,000. That’s incorrect. A person earning 12 lakhs in the progressive tax system, will pay Rs.1,12,500+ Rs.60,000 = Rs. 1,72,500. Check out the income tax slabs for previous years and other age brackets.