Income Tax Slabs and Rates – FY 2024-25, AY 2025-26

In FY 2024-25 the new tax regime has been made the default option for individual taxpayers. However, new tax regime deductions are relatively few, eligible tax payers can still choose to opt for the old tax regime instead.

When comparing the new tax regime slab rates in FY 2024-25 (AY 2025-26) vs. income tax slab rates in FY 2023-24 (AY 2024-25), it is evident that the former offers additional tax relief to tax payers making the new tax regime even more attractive. Here’s a closer look at the income tax slab rates for individual tax payers opting for the new tax regime in FY 2024-25 vs FY 2023-24:

As mentioned earlier, old tax regime income tax slabs in AY 2025-26 (FY 2024-25) have remained the same as Assessment Year 2024-25.

Here are the summarized income tax brackets for FY 2024-25 for taxpayers in India under the old tax regime:

1. Zero tax liability for individuals with income in the tax bracket of less than 2.5 lakh rupees. For senior citizen individuals aged between 60 years and 80, tax liability is nil up to Rs. 3 lakh annually. Super senior citizen tax payers aged over 80 years have zero tax liability for taxable income up to Rs. 5 lakh in a fiscal.

2. Up to 5% tax for income falling into the tax bracket of 2.5 to 5 lakh rupees based on their specific age groups

3. 20% tax for income in the tax bracket of Rs. 5 lakh to Rs. 10 lakh

4. 30% tax for individuals with annual income above 10 lakh rupees

Understanding your income tax liability for the applicable financial year is not a tough task if you know how to use an income tax calculator. You can even ask for help from professionals to check your income tax liability.

Let’s dig deeper to know about the income tax slabs for Financial Year 2024-25 for 3 key tax payer groups –

1. Individuals aged less than 60 years/Hindu Undivided Family (HUF)/Body of Individuals (BOI)/ Association of Persons(AoP)

2. Senior Citizen Tax Payers aged between 60 years and 80 years

3. Super Senior Citizen Tax Payers aged over 80 years 

Below are the tax slabs as per the old regime for FY 2024-25 if the tax payer is an individual aged less than 60 years or a non-individual tax payer such as a HUF, an AoP, a BoI, etc.

Individual tax payers who are aged between 60 years and 80 years are designated as senior citizens. Under the old tax regime these individual tax payers are entitled to a higher exemption of up to Rs. 3 lakh in AY 2025-26. The tax slabs and rates in FY 24-25 for senior citizen tax payers who opt for the old tax regime are as below:

Super Senior Citizens are individuals who aged over 80 years. These individual tax payers are eligible for a higher exemption limit of up to Rs. 5 lakh. This means super senior citizen tax payers are not required to pay any income tax on annual taxable income up to Rs. 5 lakh earned during FY 2024-25. The income tax slabs and rates for super senior citizen taxpayers in AY 2025-26 look like this:

The Budget 2024 announcement also featured some additional good news for salaried individuals in the form of an increase in the standard deduction to Rs. 75,000 for AY 2025-26. Till AY 2024-25, standard deduction was fixed at Rs. 50,000.

Since standard deduction is applicable irrespective of the salary of the taxpayer, this additional 25,000 can provide tax savings of Rs. 7,500 (excluding cess) to those in the highest 30% tax bracket. No tax saving investment needs to be made to get this benefit. However, self-employed individual tax payers, self-employed professional and non-individual taxpayers such as HUFs are not eligible to avail this benefit.     

1. The rates of the income tax slabs mentioned above do not contain details of surcharge and cess. Health and Education Cess of 4% is applicable on the income tax payable for the fiscal. The surcharge applicable on income over Rs. 50 lakh in FY 2024-25 is as per the below mentioned rates:

As you can see, the maximum income tax surcharge under the new tax regime is capped at 25% whereas, the maximum surcharge payable under the old tax regime for AY 2025-26 is 37%.

2. The income tax slabs and rates are the same for both men and women.

3. If your income lies in the tax bracket of up to 5 lakh rupees in FY 2024-25, you are eligible for a tax rebate up to Rs. 12,500 under Section 87A under the old tax regime. Under the new tax regime, annual taxable income up to Rs. 7 lakh is eligible for a similar 100% tax rebate under Section 87A.