INCOME TAX ON SALARIES F.Y. 2016-17

INCOME TAX ON SALARIES F.Y. 2016-17

INCOME-TAX

DEDUCTION

FROM

SALARIES

DURING

THE FINANCIAL

YEAR

2016-17

UNDER SECTION

192

OF

THE

INCOME-TAX

ACT,

1961
Untitled 3

  
CIRCULAR NO : 01/2017

F.No.

275/192/2016-IT(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
******
North Block, New Delhi
Dated the 2nd January, 2017 

SUBJECT:

INCOME-TAX

DEDUCTION

FROM

SALARIES

DURING

THE FINANCIAL

YEAR

2016-17

UNDER SECTION

192

OF

THE

INCOME-TAX

ACT,

1961.

***** 
Reference is invited to Circular No.20/2015 dated 02.12.2015 whereby the
rates of deduction of income-tax from the payment of income under the head “Salaries” under Section 192 of the
Income-tax Act, 1961 (hereinafter ‘the Act’), during the financial year 2015-16, were intimated. The present Circular contains
the rates of deduction of income-tax from the payment of income chargeable under the head “Salaries” during the financial
year 2016-17 and explains certain related provisions of the Act and Income-tax Rules, 1962 (hereinafter the Rules).
The relevant Acts, Rules, Forms and Notifications are available at the website of the Income Tax Department- www.incometaxindia.gov.in.
2.

RATES OF INCOME-TAX AS PER FINANCE ACT, 2016:
As per the Finance Act, 2016, income-tax is required to be deducted under
Section 192 of the Act from income chargeable under the head “Salaries” for the financial year 2016-17 (i.e. Assessment Year
2017-18) at the following rates:

2.1

Rates of tax
 

A.
Normal

Rates

of

tax: 

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Sl

N

o
Total

Income
Rate

of

tax
1 Where the total income does not exceed Rs.

2,50,000/-.
Nil
2 Where the total income exceeds Rs. 2,50,000/-

but does not exceed Rs. 5,00,000/-.
10 per cent of the amount by which the total income exceeds
Rs.

2,50,000/-
3 Where the total income exceeds Rs. 5,00,000/- but

does not exceed Rs. 10,00,000/-.
Rs. 25,000/- plus 20 per cent of the amount by which the
total

income exceeds Rs. 5,00,000/-.
4 Where the total income exceeds Rs. 10,00,000/-. Rs. 1,25,000/- plus 30 per cent of the amount by which the
total

income

exceeds Rs. 10,00,000/-





B.

Rates

of

tax

for

every

individual,

resident

in

India,

who

is

of

the

age

of

sixty

years

or

more

but

less

than

eighty

years

at any

time

during

the

financial

year:

Sl

No
Total

Income
Rate

of

tax
1 Where the total income does not exceed

Rs. 3,00,000/-
Nil
2 Where the total income exceeds Rs.

3,00,000 but does not exceed Rs.

5,00,000/-
10 per cent of the amount by which the total income exceeds
Rs.

3,00,000/-
3 Where the total income exceeds Rs.

5,00,000/- but does not exceed Rs.

10,00,000/-
Rs. 20,000/- plus 20 per cent of the amount by which the
total income

exceeds Rs. 5,00,000/-.
4 Where the total income exceeds Rs.

10,00,000/-
Rs. 1,20,000/- plus 30 per cent of the amount by which the
total income

exceeds Rs. 10,00,000/-
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C.

In

case

of

every

individual

being

a

resident

in

India,

who

is

of

the

age

of

eighty

years

or

more

at

any

time

during

the

financial

year:

Sl

No
Total

Income
Rate

of

tax
1 Where the total income does not exceed

Rs. 5,00,000/-
Nil
2 Where the total income exceeds Rs.

5,00,000 but does not exceed Rs.

10,00,000/-
20 per cent of the amount by which the total income exceeds
Rs.

5,00,000/-
4 Where the total income exceeds Rs.

10,00,000/-
Rs. 1,00,000/- plus 30 per cent of the amount by which the
total income

exceeds Rs. 10,00,000/-




2.2
Surcharge

on

Income

tax:
The amount of income-tax computed in accordance with the preceding
provisions of this Paragraph, or the provisions of section 111A or section 112 of the Income-tax Act, shall, in the case of every
individual or Hindu undivided family or association of persons or body of individuals, whether incorporated or not, or every
artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, having a total income
exceeding one crore rupees, be increased by a surcharge for the purpose of the Union calculated at the rate of fifteen per cent of such
income-tax:
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Provided that in the case of persons mentioned above having total income
exceeding one crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount
payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees.
2.3.1
Education

Cess

on

Income

tax:
The amount of income-tax including the surcharge if any, shall be increased
by Education Cess on Income Tax at the rate of two percent
of the income-tax.
2.3.2
Secondary

and

Higher

Education

Cess

on

Income-tax:
An additional education cess is chargeable at the rate of one percent of
income-tax including the surcharge if any, but not including the Education Cess on income tax as in 2.3.1.





Source:http://incometaxindia.gov.in/pdf

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