What is Section 115BAC under Income Tax Act 1961?

It was introduced by Finance Act 2020, effecting from 01.04.2020. Concessional rates of tax as per income brackets is given to the taxpayers under this section. The most affecting condition of this section is that the computation of income tax will be without any type of deduction or exemption. In other way we can say that whatever tool like 80C, 80D, Home Loan interest/principal, set off of any loss etc. we are using to save maximum income tax on salary, are not available in section 115BAC.

Following are the rates of income tax under the new regime i.e. section 115BAC:

Total Income (In Rs.)	Rate of Tax
Upto 2,50,000	Nil
2,50,001 to 5,00,000	5%
5,00,001 to 7,50,000	10%
7,50,001 to 10,00,000	15%
10,00,001 to 12,50,000	20%
12,50,001 to 15,00,000	25%
Above 15,00,000	30%

If any person is having income from profession or business and he opt for new regime while filing return, he has to file return through new regime only in subsequent years unless the income ceases to be from profession or business. However, such person can exercise the switch from new to old regime only once.

Surcharge will be applicable as being done hitherto.