Expert verified Written By – PKC Desk, Edited By – Abhinand, Reviewed By – Aakash
TL;DR Summary
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- INDIVIDUAL/HUF/AOP/BOI/AJP :
| Net income range | Rate |
| Up to Rs. 2,50,000 | – |
| Rs. 2,50,000 to Rs. 5,00,000 | 5% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
Sole proprietors taxed under individual slab rates can learn practical ways on How to Save Tax in Proprietorship Firm.
SENIOR CITIZEN (60Yrs <= Age < 80Yrs)
| Net income range | Rate |
| Up to Rs. 3,00,000 | – |
| Rs. 3,00,000 to Rs. 5,00,000 | 5% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
SUPER SENIOR CITIZEN ( 80 Yrs or more)
| Net income range | Rate |
| Up to Rs. 5,00,000 | – |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
SURCHARGE:
| Rs. 50 Lakhs – Rs. 1 Crore | Rs. 1 Crore – Rs. 2 Crores | Rs. 2 Crores – Rs. 5 Crores | Rs. 5 crores – Rs. 10 Crores | Exceeding Rs. 10 Crores |
| 10% | 15% | 25% | 37% | 37% |
Note: The enhanced surcharge of 25% & 37%, as the case may be, is not levied, from income chargeable to tax under sections 111A, 112A and 115AD. Hence, the maximum rate of surcharge on tax payable on such incomes shall be 15%.The above mentioned surcharge shall be subject to marginal relief.
2. PARTNERSHIP FIRMS/LLP :Tax rate of 30%. Partnership firms should also understand the complete process of Income Tax Return Filing for Partnership Firm to ensure timely compliance.
SURCHARGE: The amount of income-tax shall be increased by a surcharge at the rate of 12% of such tax, where total income exceeds one crore rupees. However, the surcharge shall be subject to marginal relief .
3. CO-OPERATIVE SOCIETY:
| Taxable income | Tax Rate |
| Up to Rs. 10,000 | 10% |
| Rs. 10,000 to Rs. 20,000 | 20% |
| Above Rs. 20,000 | 30% |
SURCHARGE:The amount of income-tax shall be increased by a surcharge at the rate of 12% of such tax, where total income exceeds one crore rupees. However, the surcharge shall be subject to marginal relief.
4. DOMESTIC COMPANY :
| Particulars | Rates |
| Total turnover or gross receipts during the previous year 2017-18 does not exceed Rs. 400 crores | 25% |
| Opted for Section 115BA | 25% |
| Opted for Section 115BAA | 22% |
| Opted for Section 115BAB | 15% |
| Any other domestic company | 30% |
SURCHARGE: The amount of income-tax shall be increased by a surcharge at the rate of 7% of such tax, where total income exceeds one crore rupees but not exceeding ten crore rupees and at the rate of 12% of such tax, where total income exceeds ten crore rupees.
5. FOREIGN COMPANY:
| Nature of Income | Tax Rate |
| Royalty received from Government or an Indian concern or fees for rendering technical services where such agreement has been approved by the Central Government | 50% |
| Any other income | 40% |
SURCHARGE: The amount of income-tax shall be increased by a surcharge at the rate of 2% of such tax, where total income exceeds one crore rupees but not exceeding ten crore rupees and at the rate of 5% of such tax, where total income exceeds ten crore rupees. However, the surcharge shall be subject to marginal relief.
6. LOCAL AUTHORITY :A local authority is taxable at 30%
SURCHARGE: The amount of income-tax shall be increased by a surcharge at the rate of 12% of such tax, where total income exceeds one crore rupees. However, the surcharge shall be subject to marginal relief.
7. CESS & REBATE :
- Health and Education Cess: The amount of income-tax and the applicable surcharge, shall be further increased by health and education cess calculated at the rate of four percent of such income-tax and surcharge.
- Rebate u/s 87a: A resident individual (whose net income does not exceed Rs. 5,00,000) can avail rebate under section 87A. It is deductible from income-tax before calculating education cess. The amount of rebate is 100 per cent of income-tax or Rs. 12,500, whichever is less.
Frequently Asked Questions:
Q1. What are the income tax slab rates for individuals for AY 2026-27 (FY 2025-26)?
For regular individuals, HUFs, AOPs, and BOIs under the old tax regime, the slab rates for AY 2026-27 are as follows — income up to ₹2,50,000 is exempt; income from ₹2,50,000 to ₹5,00,000 is taxed at 5%; income from ₹5,00,000 to ₹10,00,000 is taxed at 20%; and income above ₹10,00,000 is taxed at 30%.
Senior citizens (60 to 80 years) get a higher basic exemption of ₹3,00,000, while super senior citizens (80 years and above) are exempt up to ₹5,00,000 with no tax liability on income below that threshold.
Q2. What is surcharge on income tax, and when does it apply?
Surcharge is an additional tax levied on the income tax payable when total income exceeds specified thresholds. For individuals, the surcharge rates for AY 2026-27 are — 10% for income between ₹50 lakh and ₹1 crore; 15% for income between ₹1 crore and ₹2 crores; 25% for income between ₹2 crores and ₹5 crores; and 37% for income above ₹5 crores.
An important exception: the higher surcharge rates of 25% and 37% do not apply to special income like short-term capital gains (Section 111A), long-term capital gains (Section 112A), and certain foreign income (Section 115AD). For these, the maximum surcharge is capped at 15%.
Q3. What are the income tax rates for companies in India for AY 2026-27?
Tax rates for domestic companies vary based on turnover and the tax regime opted for. Companies with turnover not exceeding ₹400 crores in FY 2017-18 are taxed at 25%. Companies opting for Section 115BAA pay a concessional rate of 22%, while new manufacturing companies under Section 115BAB are taxed at 15%. All other domestic companies are taxed at 30%.
For foreign companies, the rate is 40% on general income, while royalties and technical service fees approved by the Central Government are taxed at 50%. Surcharge for domestic companies is 7% where income exceeds ₹1 crore but not ₹10 crores, and 12% where income exceeds ₹10 crores.
Q4. What is the Health and Education Cess, and how is it calculated?
Health and Education Cess is levied at 4% on the total of income tax and applicable surcharge. It applies to all taxpayers — individuals, firms, companies, and other entities — and is calculated after adding surcharge to the base tax liability.
For example, if your income tax is ₹1,00,000 and surcharge is ₹10,000, the cess is calculated on ₹1,10,000, resulting in an additional ₹4,400. This cess funds health and education initiatives and cannot be avoided through deductions or exemptions.
Q5. Who is eligible for the Section 87A tax rebate, and how much is it?
The Section 87A rebate is available to resident individuals whose net taxable income does not exceed ₹5,00,000 in FY 2025-26. The rebate amount is 100% of the income tax payable or ₹12,500, whichever is lower — effectively making the tax liability nil for those within this income limit.
The rebate is applied before calculating the Health and Education Cess, and is not available to HUFs, firms, or companies. Taxpayers near the ₹5,00,000 threshold should ensure they claim all eligible deductions under Chapter VI-A to bring net income within the rebate limit.
