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Income Tax Slabs for Salaried Employees and HUF for FY 2025-26

Income Tax Slab for Salaried Person (Below 60 Years of Age) and HUF – FY 2025-26 (AY 2026-27)

Income Tax Slabs  Rate of Taxation
Up to ₹4,00,000 Nil
Between ₹4,00,001 and ₹8,00,000  5% of your total income that exceeds ₹4,00,000 
Between ₹8,00,001 and ₹12,00,000  ₹20,000 + 10% of your total income that exceeds ₹8,00,000 
Between ₹12,00,001 and ₹16,00,000  ₹60,000 + 15% of your total income that exceeds ₹12,00,000 
Between ₹16,00,001 and ₹20,00,000  ₹1,20,000 + 20% of your total income that exceeds ₹16,00,000 
Between ₹20,00,001 and ₹24,00,000  ₹2,00,000 + 25% of your total income that exceeds ₹20,00,000 
Above ₹24,00,000  ₹3,00,000 + 30% of your total income that exceeds ₹24,00,000 

Under this revised tax structure for FY 2025-26, individuals with earnings up to ₹12 lakh will not have to pay any tax thanks to an increased tax rebate of ₹60,000, under Section 87A. 

Income Tax Slabs Rate of Taxation 
Up to ₹2,50,000  Nil
Between ₹2,50,000 and ₹5,00,000  5% of your total income that exceeds ₹2,50,000
Between ₹5,00,000 and ₹10,00,000  ₹12,500 + 20% of your total income that exceeds ₹5,00,000
Above ₹10,00,000  ₹1,12,500 + 30% of your total income that exceeds ₹10,00,000

Additionally, you will also be levied an additional 4% Health and Education cess, irrespective of the chosen tax regime.

Income Tax Slab for Salaried Person (Below 60 Years of Age) and HUF – FY 2024-25 (AY 2025-26)

Income Tax Slabs   Rate of Taxation 
Up to ₹3,00,000  Nil 
Between ₹3,00,001 and ₹7,00,000   5% of your total income that exceeds ₹3,00,000  
Between ₹7,00,001 and ₹10,00,000   ₹20,000 + 10% of your total income that exceeds ₹7,00,000  
Between ₹10,00,001 and ₹12,00,000   ₹50,000 + 15% of your total income that exceeds ₹10,00,000  
Between ₹12,00,001 and ₹15,00,000   ₹80,000 + 20% of your total income that exceeds ₹12,00,000  
Above ₹15,00,001   ₹1,40,000 + 30% of your total income that exceeds ₹15,00,000

Additionally, you will also be levied an additional 4% Health and Education cess.

Income Tax Slabs Rate of Taxation 
up to ₹2,50,000  Nil
Between ₹2,50,000 and ₹5,00,000  5% of your total income that exceeds ₹2,50,000
Between ₹5,00,000 and ₹10,00,000  ₹12,500 + 20% of your total income that exceeds ₹5,00,000
Above ₹10,00,000  ₹1,12,500 + 30% of your total income that exceeds ₹10,00,000

Additionally, you will also be levied an additional 4% Health and Education cess, irrespective of the chosen tax regime.

Different Tax Scenarios under New Tax Regime FY 2025-26 (AY 2026-27)

Additional Surcharge for Income Above ₹50 Lakhs

If your income exceeds ₹50 lakhs, an additional surcharge as per the given rates will be levied on your existing income tax rates for assessing the total tax for FY 2025-26.

Note that for FY 2022-23, the highest surcharge on income over ₹5 Crore was 37%. After Union Budget 2023, this surcharge has been reduced to 25% under the new tax regime, effective from April 1, 2023, while all the other surcharge rates remain the same.

Taxable Income Surcharge (New Tax Regime) Surcharge (Old Tax Regime)
For those with an income above ₹50 Lakh but below ₹1 Crore 10% 10%
For those with an income of above ₹1 Crore but below ₹2 Crore 15% 15%
For those with an income of above ₹2 Crore but below ₹5 Crore 25% 25%
For those with an income of above ₹5 Crore  25% 37%

Income Tax Rebate for Salaried Individuals and HUF – FY 2025-26

How is Your Income up to ₹12 Lakhs Tax Free?

What is Marginal Relief & How it is Calculated?

Marginal relief is a tax benefit provided under Section 87A that ensures that taxpayers whose income exceeds ₹12 lakh by a small margin do not have to pay significantly more tax.

Marginal relief is applicable to incomes up to ₹12.75 lakh, after which normal tax rates apply, as per the IT slabs. Here’s how it is calculated:

Total Income (₹) Tax Without Marginal Relief (₹) Tax With Marginal Relief (₹)
₹12,00,000 ₹60,000 ₹0
₹12,10,000 ₹61,500 ₹10,000
₹12,50,000 ₹67,500 ₹50,000
₹12,75,000 ₹71,250 ₹71,250

Income Tax Exemptions and Deductions Not Allowed for Salaried Individuals and HUF Under New Tax Regime – FY 2025-26

Income Tax Exemptions and Deductions Allowed for Salaried Individuals Under New Tax Regime – FY 2025-26

Income Tax Deductions and Exemptions Allowed for Salaried Individuals Under Old Tax Regime for FY 2025-26

Following is a table illustrating the applicability of these income tax exemptions under the old tax regime along with their limits, which can be used as tax saving options for salaried people:

Section Benefit Limit
Section 80C On earnings from -   Maximum exemption limit of up to ₹1.5 lakhs. 
Principal payment on home loans  
Tax saving fixed deposits  
National Savings Certificate  
Equity Linked Savings Scheme  
National Pension Scheme  
Employees Provident fund  
Public Provident Fund  
Senior Citizens Savings Scheme  
Sukanya Samriddhi Yojana, etc. 
Section 80CCC On the deposited amount in LIC annuity plans.  Maximum exemption limit of up to ₹1.5 lakhs. 
Section 80TTA On interest earned from the bank savings account.  Limit is up to ₹10,000. 
Section 80GG Rent payment when the individual does not earn House Rent Allowance.  The lower amount between –  
Rent paid – (10% of total income)  
25% of the total income  
₹5000 per month
Section 24a Interest on home loans for self-occupied property and let out property.  Up to ₹2 lakhs for self-occupied property. 
No limit for let-out property. 
Section 80E Total interest paid on education loan.  No limit on the maximum amount. 
Section 80EEA Home loan interest for first timers.  Up to ₹50,000 
Section 80CCG Investment in equity products under the Rajiv Gandhi Equity Scheme for first-time investors.  The lower amount between-  ₹50,000  
50% of the investment amount in equity schemes. 
Section 80D Health insurance policy premium for self and family.  ₹25,000 (for self, spouse and dependent children) + ₹25,000 for parents below 60 years. 
₹25,000 (for self, spouse and dependent children) + up to ₹50,000 (for parents above 60 years of age).  
Up to ₹50,000 for members of HUF where a member is above 60 years + up to ₹50,000 (for parents above 60 years of age). 
Section 80DDB Medical treatment of dependent individuals suffering from specified diseases. For individuals below 60 years of age, the deduction is available for up to ₹ 40,000.  
Section 80GGC Contribution to political parties. No limitations on payment methods apart from cash. 
Section 80G Contributions to charitable institutions and certain relief funds. Few charitable donations are eligible for 50% deductions, and few are eligible for 100% deductions. 

These are some of the major income tax exemptions for salaried employees in India.

With such allowances and exemptions from income tax for salaried persons, you can reduce your tax liabilities to quite an extent. So, before you start filing your income tax returns for the previous financial year, make sure you have a comprehensive idea about all the applicable slabs, exemptions and benefits that you can avail yourself of your tax payments.

FAQs about Income Tax for Salaried Individuals