for Financial Year 2020-21 i.e. for assessment year 2021-22. The normal tax rates applicable to a resident individual will depend on the age of the individual. However, in case of a non-resident individual the tax rates will be same irrespective of his age. For the purpose of ascertainment of the applicable tax slab, an individual can be classified as follows:

• Resident individual below the age of 60 years.
• Resident individual of the age of 60 years or above at any time during the year but below the age of 80 years.
• Resident individual of the age of 80 years or above at any time during the year.
• Non-resident individual irrespective of the age.

Surcharge: Surcharge is levied on the amount of income-tax at following rates if total income of an assessee exceeds specified limits:-

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 1 15AD. Hence, the maximum rate of surcharge on tax payable on such incomes shall be 15%.

However, marginal relief is available from surcharge in following manner-

• In case where net income exceeds Rs. 50 lakh but doesn’t exceed Rs. 1 Crore, the amount payable as income tax and surcharge shall not exceed the total amount payable as income tax on total income of Rs 50 Lakh by more than the amount of income that exceeds Rs 50 Lakhs.
• In case where net income exceeds Rs. 1 crore but doesn’t exceed Rs. 2 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 1 crore by more than the amount of income that exceeds Rs. 1 crore.
• In case where net income exceeds Rs. 2 crore but doesn’t exceed Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 2 crore by more than the amount of income that exceeds Rs. 2 crore.
• In case where net income exceeds Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 5 crore by more than the amount of income that exceeds Rs. 5 crore.

Health and Education Cess: Health and Education Cess is levied at the rate of 4% on the amount of income-tax plus surcharge. The Finance Act, 2020, has provided an option to Individuals and HUF for payment of taxes at the following reduced rates from Assessment Year 2021-22 and onwards -

AMT - The assessee opting for this scheme have been kept out of the purview of Alternate Minimum Tax (AMT). Further the provision relating to the computation, carry forward and set off of AMT credit shall not apply to these assessees.

Note: 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.

Conditions to be satisfied:

The option to pay tax at lower rates shall be available only if the total income of assessee is computed without claiming following exemptions or deductions -

• Leave Travel concession [Section 10(5)]
• House Rent Allowance [Section 10(13A)]
• Official and personal allowances (other than those as may be prescribed) [Section 10(14)]
• Allowances to MPs/MLAs [Section 10(17)]
• Allowances for income of minor [Section 10(32)]
• Deduction for units established in Special Economic Zones (SEZ) [Section 10AA]
• Standard Deduction [Section 16(ia)]
• Entertainment Allowance [Section 16((ii)]
• Professional Tax [Section 16(iii)]
• Interest on housing loan [Section 24(b)]
• Additional depreciation in respect of new plant and machinery [Section 32(1)(iia)]
• Deduction for investment in new plant and machinery in notified backward areas [Section 32AD]
• Deduction in respect of tea, coffee or rubber business [Section 33AB]
• Deduction in respect of business consisting of prospecting or extraction or production of petroleum or natural gas in India [Section 33ABA]
• Deduction for donation made to approved scientific research association, university college or other institutes for doing scientific research which may or may not be related to business [Section 35(1) (ii)]
• Deduction for payment made to an Indian company for doing scientific research which may or may not be related to business [Section 35(1)(iia)]
• Deduction for donation made to university, college, or other institution for doing research in social science or statistical research [Section 35(1) (iii)]
• Deduction for donation made for or expenditure on scientific research [Section 35(2AA)]
• Deduction in respect of capital expenditure incurred in respect of certain specified businesses, i.e., cold chain facility, warehousing facility, etc. [Section 35AD]
• Deduction for expenditure on agriculture extension project [Section 35CCC]
• Deduction for family Pension [Section 57(iia)]
• Deduction in respect of certain incomes other than specified under Section 80JJAA, 80CCD(2) and deduction under section 80LA for Unit located in IFSC [Part C of Chapter VI-A]

Total income of the assessee is calculated after claiming depreciation under section 32, other than additional depreciation, and without adjusting brought forward losses and depreciation from any earlier year (if such loss or depreciation pertains to any deduction under the aforesaid sections). Further, loss under the head house property can’t be set off against other heads of Income. Moreover, such loss and depreciation will not be carried forward.

If the assessee has any unabsorbed depreciation, relating to additional depreciation, which has not been given full effect, the corresponding adjustment shall be made to WDV of the block of assets in the prescribed manner.

In case the assessee has business or professional income, this option shall be exercised on or before the due date for furnishing the returns of income. Once the assessee has exercised the option for any previous year, it cannot be subsequently withdrawn for the same or any other previous year. The option once exercised for any previous year can be withdrawn only once in subsequent previous year (other than the year in which it was exercised) and thereafter, he shall never be eligible to exercise this option again except where such person ceases to have any business income.

If assessee does not have business or professional income, the option must be exercised along with the return of income for every previous year. If an assessee, after opting for Section 115BAC, claims any of prescribed deduction or allowance in any previous year, then the option to pay tax at concessional rate shall become invalid for that year.

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the amount under the wrong head and it cannot be used to discharge the liabilities which may be due in another head. In such cases taxpayers can claim the refund of the amount which may have been deposited under wrong head in GST by filing a refund application in FORM RFD-01 under the category “Excess balance in electronic cash ledger”. The process of filing refund claim and its disbursement can sometimes lead to blockage of funds for the taxpayer.

Form GST PMT-09 is now available on GST portal and it enables a taxpayer to make intra-head or inter-head transfer of amount available in Electronic Cash Ledger. A taxpayer can file GST PMT 09 for transfer of any amount of tax, interest, penalty, fee or others available under one (major or minor) head to another (major or minor) head in the Electronic Cash Ledger. Form GST PMT 09 provides flexibility to taxpayers to make multiple transfers from more than one Major/Minor head to another Major/Minor head if the amount is available in the Electronic Cash Ledger. To file Form GST PMT-09 taxpayers are required to login on GST portal with valid credentials and navigate to Services > Ledgers > Electronic Cash Ledger > File GST PMT-09 For Transfer of Amount option. After Form GST PMT-09 is filed -

• ARN is generated on successful filing of Form GST PMT-09
• An SMS and an email is sent to the taxpayer on his registered mobile and email id
• Electronic Cash ledger will get updated after successful filing of Form GST PMT-09
• Filed form GST PMT-09 will be available for view/download in PDF format.

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