Direct Taxes Code 2009 – Proposed Income Tax Rates From 1 April 2011

Indian Finance Minister released the draft of Direct Tax Code 2009, which is expected to be powerful from 1 April 2011, for public discussions on 20 August 2009. New Code shall replace India’s antiquated Income Tax Act, 1961. It is a key step in the direction of considerably awaited tax reforms in India and aims to simplify the whole regime of taxation radically.

All the direct taxes such as revenue, wealth, and dividend distribution are covered under 1 uniform Direct Tax Code in line with other nations like USA, UK and Germany. Unlike the past Income Tax Act, 1961, the language of the new code is quite significantly easy, making it easier for ordinary persons to realize the provisions of Income Tax.

At present, the rates of direct taxes are declared every single year even though presenting the Annual Price range and Finance Act in the month of February. Nonetheless, in the Direct Tax Code, the rates have currently been prescribed in the several schedules and as a result it has accomplished away with the need for an annual Finance Bill. From 1 April 2011, when the new code will come into effect, the changes in the tax rates, if any, will have to be completed through suitable Amendment Expenses.

Taxation Pundits are busy analysing the New Code and submitting their suggestions to the Finance Ministry. Keeping aside the expert views, let’s see what are the proposed Income Tax rates for the Resident Individuals.

With the new revenue tax slabs, individuals in the greater income slab will be tremendously benefited. Resident Indians who are paying tax @ 30% on gross revenue of more than 800,000 (as per budget 2010) will now pay tax @ ten% from 1 April 2011. Refer the rates given below to know the exact rates. Exemption limit for deductions from Income (tax incentives for savings) has been raised to 300,000 as against the present limit of Rs.100,000 below area 80C. With the widening of tax slabs, average Indians will have much more disposable income and therefore it will drive the consumption and the general economy. Please note that the new rates are probably to be implemented with impact from Financial Year 2011-2012 when the proposed Direct Tax Code 2009 is enacted in the Parliament.

Proposed Income Tax Slabs for Resident Men and women and HUF as per the Direct Tax Code 2009, probably to be successful from 1 April 2011

Taxable income up to 160,000 for guys, up to 190,000 for girls and up to 240,000 for senior citizens (resident folks of 65 years or above): Tax Rate NIL
Taxable income 160,001 – 1,000,000: Tax Rate ten%
Taxable earnings 1,000,001 – two,500,000: Tax Rate 20% Taxable earnings two,500,001 upwards: Tax Rate 30% Present Income Tax Slabs for Resident Individuals and HUF as per Price range 2010, applicable for the Monetary Year 1 April 2010 to 31 March 2011

Taxable earnings up to 160,000 for guys, up to 190,000 for girls and up to 240,000 for senior citizens (resident people of 65 years or above): Tax Rate NILTaxable revenue 160,001 – 500,000: Tax Rate ten%
Taxable revenue 500,001 – 800,000: Tax Rate 20%
Taxable earnings 800,001 upwards: Tax Rate 30%

-wealth management services

-wealth management

-make money

(MAN2878c10)

Tagged with: • • •

Filed under: Business Opportunities

Like this post? Subscribe to my RSS feed and get loads more!