Rebate

Rebate Under Section 87A FY 2019-2020 (AY 2020-2021)

You are eligible to claim tax rebate under this provision if you meet the following conditions:

  1. You must be a RESIDENT INDIVIDUAL; and
  2. Your Total Income, less Deductions, (under Section 80) is equal to or less than Rs 5,00,000.
  3. The rebate is limited to Rs 12,500. This means the total tax payable or Rs 12,500, whichever is lower, that amount will be the rebate under section 87A. [This rebate is applied to the total tax before adding the Education Cess (4%)]

Examples for Rebate under section 87A allowed to Resident Individuals including Senior Citizens:

Total IncomeTax payable before cessRebate u/s 87ATax Payable + 4% Cess
3,00,0002,5002,5000
3,50,0005,0005,0000
5,00,00012,50012,5000
5,50,00022,500022,500+900=23,400

Tax Rate

Rates applicable for the AY 2020-21 (FY 2019-2020)

Individual, HUF, AOP, BOI, Artificial Juridical Person

Income Rate of Tax
Income up to Rs 2,50,000 No Tax
Income from Rs 2,50,001 – Rs 5,00,000 5 %
Income from Rs 5,00,001 – 10,00,000 20 %
Income more than Rs 10,00,000 30 %

Income tax slab for senior citizens (60 years to less than 80 years old)

Income Rate of Tax  
Income up to Rs.3,00,000 No Tax
Income from Rs.3,00,001 to Rs.5,00,000 5 %
Income from Rs 5,00,001 – 10,00,000 20 %
Income more than Rs 10,00,000 30 %

Income tax slab for senior citizens (80 years or more)

Income Rate of Tax  
Income up to Rs 5,00,000 No Tax  
Income from Rs 5,00,001 – 10,00,000 20 %
Income more than Rs 10,00,001 30 %
  • Surcharge:
    • 10% surcharge on income tax if the total income exceeds Rs 50 Lakhs but below Rs 1 crore
    • 15% surcharge on income tax if the total income exceeds Rs 1 crore but below Rs 2 crore
    • 25% surcharge on income tax if the total income exceeds Rs 2 crore but below Rs 5 crore
    • 37% surcharge on income tax if the total income exceeds Rs 5 crore
  • Note: The enhanced surcharge of 25% & 37%, as the case may be, is not levied, from income chargeable to tax under sections 111A112A, and 115AD. Hence, the maximum rate of surcharge on tax payable on such incomes shall be 15%.
  • Health Cess: 1% cess on income tax including surcharge
  • Education Cess: 2% cess on income tax including surcharge
  • Secondary and Higher Education Cess: 1% cess on income tax including surcharge

Example

Particulars   Tax Liability
For first 2.5 Lakhs   0
From Rs.2,50,001 to Rs.5,00,000 =2,50,000*5%                12,500
From Rs.5,00,001 to Rs.10,00,000 =5,00,000*20%               1,00,000
Tax Liability   1,12,500
Health Cess =1,12,500*1%                 1,125
Education Cess =1,12,500*2%                  2,250
Secondary and Higher Education Cess =1,12,500*1%                 1,125
Total Tax Liability       1,17,000