The new Income Tax slab has come into force in the country from 1 April 2020. The new tax slab rates have been kept optional by the government. If a taxpayer is benefiting more from the old slab, he can file it. The Income Tax Department has issued an explanation for those who want to select the new tax slab announced in the Budget 2020.
What is the new tax system?In the new system of personal income tax in the budget 2020, income of Rs 2.5 lakh to 5 lakh will be taxed at 5%.5 to 7.5 lakhs at 10 per cent.7.50 to 10 lakh rupees will be taxed at the rate of 15 percent.Also, 20 per cent on income from Rs 10 lakh to 12.5 lakh.25 per cent on income of Rs 12.5 to 15 lakhs .Income above Rs 15 lakh will attract 30 per cent tax.Explanation of Income Tax Department.
Such employees, who do not earn from business or any profession, will have to inform their employers about opting for the new tax regime to deduct tax on TDS. If employees do not exercise this option, they will be taxed only under the old slab present in the Income Tax Act.Employees must inform the employer of their intention to select new tax rates for TDS. Employees can change the tax structure option when filing income tax returns. Based on this, the amount of TDS payment will be adjusted.
According to the provision of Section 115 BAC of the Income Tax Act, the deduct or will calculate the total income and deduct TDS. If the employees do not give such information, the employer will create TDS without considering the provision of Section 115 BAC of the Act.