INCOME TAX SLAB FOR FY 2022-23
Table of Contents
What is income tax slab?
Individual taxpayers will be required to pay income tax according to the applicable slab structure. A person may be assigned to a different tax bracket depending on their income. Consequently, people with greater incomes will be required to pay more tax. The introduction of the slab system aimed to keep the nation's taxation structure equitable. At each budget announcement, the slabs frequently alter.
Income Tax Slab for FY 2022 - 23 (AY 2023 - 24)
Given below are the various tables for the Revised Income Tax Slabs and rates for the FY 2022-2023 and AY 2023-24:
| SL.NO | INCOME TAX SLAB AS PER OLD REGIME | TAX RATES AS PER OLD REGIMES | SL.NO | INCOME TAX SLAB AS PER NEW REGIME | INCOME TAX SLAB AS PER NEW REGIME |
|---|---|---|---|---|---|
| 1 | Up to Rs 2,50,000 | NIL | 1 | Up to Rs 2,50,000 | NIL |
| 2 | Rs 2,50,001 - Rs 5,00,000 | 5% | 2 | Rs 2,50,001 -Rs 5,00,000 | 5% |
| 3 | Rs5,00,001-Rs10,00,000 | 20% | 3 | Rs 5,00,001 -Rs 7,50,000 | 10% |
| 4 | Above Rs 10,00,000 | 30% | 4 | Rs 7,50,001- Rs10,00,000 | 15% |
| 5 | 5 | Rs10,00,001- Rs12,50,000 | 20% | ||
| 6 | 6 | Rs12,50,001- Rs 15,00,000 | 25% | ||
| 7 | 7 | Above Rs 15,00,000 | 30% |
Key differences between the old and new tax regimes
There are 2 key differences:
- Firstly, the new tax regime includes more tax slabs with lower rates as compared to old tax regime. Hence the income tax slabs for 2022-23 (AY2023-24) are different based on whether you opt for the new or old tax regime.
- Secondly, all major deductions and exemptions such as Section80C, Section80D, etc. that are available under the owed if you opt for the new tax regime.
Things you must keep in mind before opting for the new tax slab
There are few things you must keep in mind before opting for the new tax slab:
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Consider Tax Saving Deductions and Exemptions
In FY 2022-23, the new tax regime has lower income tax slab rates and more income tax Slab compared to the old regime. But the new tax regime offers very few exemptions and deductions. These include about 70 deductions and exemption like HRA, Section 80C deductions and home loan interest benefit that can be claimed under the old tax regime but cannot be claimed under the new regime.
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Lower Tax exemption limit Based on Age
The old tax regime provides higher tax exemption for senior citizens and super senior citizens of Rs. 3 lakh and Rs. 5 lakh respectively as per income tax slab rates in AY 2023-24. This higher limit is not available under the new tax regime, which offer the same Rs. 2.5 lakh exemption limit irrespective of taxpayer's age.
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Consider Benefits Beyond Tax Savings
Tax saving investments and expenses like a term life insurance policy, Public Provident Fund, National Pension System provide a dual benefit under the old tax regime. On the one hand, you decrease your tax outgo; on the other hand they also provide benefits like financial security of loved ones or long-term wealth creation. In the case of the new tax regime, you do not receive the tax saving benefit at all
However, tax benefits of these investments are limited up to Rs. 2 lakh in a fiscal after including the Rs 50,000 benefit offered u/s 80 CCD (1B). So, you need to use an income tax calculator to compute your tax outgo under both the new and old regime in order to determine which is suitable for you based on the income tax slab rates for FY 2022-23.
We hope that you enjoyed our article about income tax slab for FY 2022-23. These are the tax slabs for the current financial year of 2022-23. For more details about this please visit info@bbnc.in
