India Income Tax Slabs & Rates
Tax System Overview
System: Progressive (slab-based)
Authority: Central Board of Direct Taxes (CBDT)
Law: Income Tax Act, 1961
India’s financial year runs 1 April to 31 March. The New Tax Regime (default from FY 2024–25) offers lower rates but fewer deductions. The Old Regime allows more deductions (80C, HRA, etc.).
Key Deductions & Allowances
New Regime: Standard deduction of ₹75,000. Old Regime: Section 80C (up to ₹1.5 lakh for PPF, ELSS, insurance), HRA exemption, Section 80D (health insurance up to ₹25,000), NPS contribution (80CCD).
India Income Tax Brackets
Current tax rates for India. Progressive (slab-based) system.
| Income Range | Tax Rate |
|---|---|
| ₹0 – ₹4,00,000 | 0% (Nil) |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| ₹24,00,001+ | 30% |
Additional Taxes & Contributions
Beyond income tax, India workers may pay these additional charges.
| Tax / Contribution | Rate | Notes |
|---|---|---|
| Health & Education Cess | 4% | On total income tax amount |
| Surcharge | 10–37% | On income above ₹50 lakh; varies by slab |
| Professional Tax | ₹200–₹2,500/month | State-level; varies by state |
| EPF (Employee Provident Fund) | 12% | Of basic salary; employer matches |
Effective Tax Rates by Income
Estimated federal/national income tax only. Shows how effective rates differ from marginal rates.
| Annual Income | Est. Tax | Effective Rate |
|---|---|---|
| ₹500,000 | ₹5,000 | 1.0% |
| ₹800,000 | ₹20,000 | 2.5% |
| ₹1,000,000 | ₹40,000 | 4.0% |
| ₹1,500,000 | ₹115,000 | 7.7% |
| ₹2,500,000 | ₹415,000 | 16.6% |
Estimates based on standard deductions/allowances. Actual tax depends on personal circumstances, filing status, and applicable credits.
About India's Tax System
India uses a slab-based income tax system. The New Tax Regime (default from FY 2024–25) has 7 slabs with lower rates but minimal deductions. The Old Tax Regime offers higher rates but allows deductions under Section 80C, 80D, HRA, etc.
A 4% Health and Education Cess is added to the total tax amount. High earners above ₹50 lakh pay an additional surcharge ranging from 10% to 37%.
The Employee Provident Fund (EPF) at 12% of basic salary is a mandatory retirement contribution, matched by the employer. While not a tax, it significantly impacts take-home pay.
Indian tax amounts use the lakh (₹1,00,000) and crore (₹1,00,00,000) numbering system.
Tax Brackets by Country
Compare income tax systems across different countries.
United States
Canada
United Kingdom
Australia
New Zealand
Germany
Ireland
Singapore
South Africa
Japan
PhilippinesFrequently Asked Questions
Under the New Regime: Nil (up to ₹4 lakh), 5% (₹4–8 lakh), 10% (₹8–12 lakh), 15% (₹12–16 lakh), 20% (₹16–20 lakh), 25% (₹20–24 lakh), 30% (above ₹24 lakh).
Section 80C allows deductions up to ₹1.5 lakh per year for investments in PPF, ELSS mutual funds, life insurance, NSC, etc. Available only under the Old Tax Regime.
The New Regime has lower tax rates but fewer deductions. The Old Regime allows deductions like 80C, HRA, and 80D. Choose based on your total deductible investments.
A 4% Health and Education Cess is levied on the total income tax (including surcharge). It funds healthcare and education programs.