Revised tax slabs: Here’s how much tax you will pay on your salary

The Finance Bill 2024 has ushered in a significant overhaul of income tax slabs affecting salaried individuals, resulting in a marked increase in taxation across various income brackets.

The revised slabs, delineated in the amended bill, indicate substantial alterations compared to the previous structure.

Outlined below are the revised income tax slabs juxtaposed with their previous counterparts:

While the income tax exemption for the initial slab, encompassing annual salaries up to Rs600,000, remains unaltered, adjustments have been made to other income brackets. Notably, the maximum income tax slab has been notably reduced from Rs6 million to Rs4.1 million.

Under the revised regime, individuals earning below Rs600,000 annually (equivalent to Rs50,000 per month) will continue to be exempt from income tax. However, for those falling within the range of Rs600,001 to Rs1,200,000 per year (Rs50,000 to Rs100,000 per month), the tax rate has been increased to 5 per cent from the previous 2.5 per cent on the amount exceeding Rs600,000.

Moreover, individuals earning between Rs1,200,001 to Rs2,200,000 annually (equivalent to Rs100,000 to Rs183,333 per month) will now be subject to a tax of Rs30,000 plus 15 per cent of the amount exceeding Rs1.2 million.

For those earning within the bracket of Rs2,200,001 to Rs3,200,000 per year (Rs183,333 to Rs266,667 per month), the revised tax stands at Rs180,000 plus 25 per cent of the amount exceeding Rs2.2 million.

Likewise, individuals earning between Rs3,200,001 to Rs4,100,000 annually (Rs266,667 to Rs341,667 per month) will face a tax liability of Rs430,000 plus 30 per cent of the amount exceeding Rs3.2 million.

Finally, for individuals with annual earnings surpassing Rs4,100,000 (more than Rs341,667 per month), the revised tax obligation stands at Rs700,000 plus 35 per cent of the amount exceeding Rs4.1 million.

These revisions underscore a significant shift in the taxation landscape, potentially impacting the financial planning and obligations of salaried individuals across the board.