Tax is computed using a tax slab on income. It implies that people pay taxes as per their income level.
No tax will be imposed on the person earning lower than Rs 3 lakh per annum.
People earning Rs 3-6 lakh per annum will be subjected to a 5 per cent tax on their income.
People earning between Rs 6 lakh and Rs 9 lakh per annum will be taxed at 10 per cent.
Annual income between Rs 9 lakh and Rs 12 lakh will be subjected to a tax of 15 per cent.
The people earning between Rs 12 lakh and Rs 15 lakh per annum is a subject to 20 per cent tax on their income.
The people earning more than Rs 15 Lakh per annum will be charged 30 per cent tax on their income.
Taxpayers may choose to stick with the old tax system, although the new tax regime is the default tax regime.
Compiled By Himani Verma