Income Tax Rates :- Budget 2013

There are no changes in tax rates for FY 2013-14 except levy of surcharge at various levels. Tax rates for different assessee’s for FY 2013-14 will be as under:

    Individuals, HUF, AOP and BOI

Total Income	FY 2013-14
Upto INR 200,000	NIL
INR 200,001 to INR   500,000	10%
INR 500,001 to INR   10,00,000	20%
INR 10,00,001 & Above	30%

v  For resident individual aged between 60 – 80 years, the basic exemption limit is INR 250,000

v  For resident individual of the age of 80 years or above, the basic exemption limit is INR 500,000

v  Surcharge @10% if Total income exceeds INR 1 crore.

v  Education cess is applicable @ 3% on Income Tax

    Firm & LLP

ü  Taxable @ 30%

ü  Surcharge @ 10% taxable income exceeds INR 1 crore.

ü  Education cess @ 3% on income tax. 

    Corporate

Domestic Companies

ü  Taxable @ 30%

ü  Surcharge @5% if total income exceeds INR 1 crore but does not exceed INR 10 crore.

ü  Surcharge @10% if total income exceeds INR 10 crore.

ü  Education cess @ 3% on income tax

Foreign Companies

ü  Taxable @ 40%

ü  Surcharge @2% if total income exceeds INR 1 crore but does not exceed INR 10 crore.

ü  Surcharge @5% if total income exceeds INR 10 crore.

ü  Education cess @3% on income tax

    Book Profit Based Taxations

Minimum Alternative Tax (MAT) (For Companies)

ü  @ 18.5% of the adjusted book profit (if normal tax is less than 18.5% of book profit)

ü  Surcharge @5% if total income exceeds INR 1 crore but does not exceed INR 10 crore.

ü  Surcharge @10% if total income exceeds INR 10 crore.

ü  Education cess is applicable @ 3%.

Alternative Minimum Tax (AMT) (Other than companies)

ü  Tax @ 18.5% of the adjusted book profit (if normal tax is less than 18.5% of book profit)

ü  Surcharge @5% if total income exceeds INR 1 crore but does not exceed INR 10 crore.

ü  Surcharge @10% if total income exceeds INR 10 crore.

ü  Education cess is applicable @ 3%.

ü  AMT will not be applicable for Individual, HUF, AOP, BOI if adjusted total income of such person does not exceeds INR 20 Lakh.

    Securities Transaction Tax

Total Income	Present ( FY 2012-13)	Proposed*** (FY 2013-14)	Payable by
Purchase / Sale of equity shares (Delivery based)	0.100%	0.100%	Purchaser / Seller
Purchase of Units of equity oriented fund (Delivery based)	0.100%	NIL	Purchaser
Sale of Units of equity oriented fund (Delivery based)	0.100%	.001	Seller
Sale of equity shares, units of equity oriented mutual fund (non-delivery based)	0.025%	.025%	Seller
Sale of an option in securities	0.017%	0.017%	Seller
Sale of an option in securities, where option is exercised	0.125%	0.125%	Purchaser
Sale of a futures in securities	0.017%	.010%	Seller

*** w.e.f. 1^st day of July, 2013

   Commodity Transaction Tax (CTT)

-          CTT is proposed to be payable by seller

-          @ .01%

-         for sale of commodity derivative other than agricultural commodities.

-         Date for CTT shall be notified by the board.

** Assessee shall be allowed a deduction of CTT paid if income from such commodities is taxed under Business head.

    Wealth Tax

Wealth tax shall be payable @ 1 % on the eligible net wealth held by assessee on the valuation date (31 March) in excess of the basic exemption of INR 30 Lakh.

Comment:

1. Reduction of STT rate for purchase and sale of equity oriented mutual funds is very good mutual funds. However proposed levy of CTT can make an adverse impact in the commodity trading.

2. Surcharge on Indian company increased to 10% from 5% and for foreign companies increased to 5% from 2%, if their total income exceeds INR 10 crore. Though the tax rates remain unchanged but due to increase in surcharge effective tax rate gets increased by more than 3%. The increase in surcharge will be applicable for only 1 year.  

3. Effective tax rate for companies having a taxable income of INR 10 crore or more will be 33.99%. In case of MAT, companies having book profit of INR 10 crore or more, the tax rate will be 20.9605%.