Default Tax Regime under Income Tax Act, 1961

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Default tax regime under section 115BAC of the Income tax Act, 1961

Under the default tax regime, income tax shall be computed at the following rates, subject to certain conditions under section 115BAC(2)(i).

Sr. No.Total IncomeRate of tax
1.Upto Rs. 3,00,000Nil
2.From Rs. 3,00,001 to Rs. 6,00,0005%
3.From Rs. 6,00,001 to Rs. 9,00,00010%
4.From Rs. 9,00,001 to Rs. 12,00,00015%
5.From Rs. 12,00,001 to Rs. 15,00,00020%
6.Above Rs. 15,00,00030%

Conditions:-

Total income shall be computed without certain exemptions or deductions:-

  1. Leave travel concession under section 10(5).
  2. House rent allowance under section 10(13A).
  3. Special allowance under section 10(14).
  4. Daily allowances or constituency allowance of MPs and MLAs under section 10(17).
  5. Income of minor child [section 10(32)].
  6. Interest on loan in respect of self-occupied property under section 24(b).
  7. Additional depreciation under section 32(1)(iia).
  8. Deduction in respect of contribution to notified approved research association/university/college/other institution for scientific research under section 35(1)(ii).
  9. Deduction in respect of contribution to approved Indian company for scientific research under section 35(1)(iia).
  10. Deduction in respect of contribution to notified approved research association/university/college/other institutions for research in social science or statistical research under section 35(1)(iii).
  11. Deduction in respect of contribution to approved National laboratory/university/IIT/specific person for scientific research undertaken under an approved programme under section 35(2AA).
  12. Deduction in respect of expenditure on specified business under section 35(AD).
  13. Deduction under Tea development account, coffee development account and rubber development account under section 33AB.
  14. Deduction under Site Restoration Fund under section 33ABA.
  15. Deduction in respect of expenditure on agricultural extension project under section 35CCC.
  16. Tax holiday for units established in Special Economic Zone under section 10AA
  17. Entertainment allowance under section 16(ii).
  18. Professional tax under section 16(iii).
  19. Deduction under Chapter VI-A other than Deduction in respect of employer’s contribution to NPS pension scheme of Central Government under section 80CCD(2).
    • Deduction in respect of contribution of Central Government to Agnipath Scheme under section 80CCH(2).
    • Deduction in respect of employment of new employees under section 80JJAA.

Note:- Losses are not allowed to be set-off.

  1. Carry forwarded or depreciation from any earlier assessment year, if such loss or depreciation is attributable to any of the deductions referred to above.
  2. Under the head “Income from house property” with any other head of income.

Under this default tax regime:- individual/HUF/AOPs [other than a cooperative society]/BOIs or artificial juridical person are covered.

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