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Section 115BAC of Income Tax Act at a Glance

Sudiesh 
on 19 June 2020

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There is a new section called 115BAC inserted in Income Tax, 1961. This is going to effect from AY 2021-22. An assessee can opt old system or new as he wish. When an assessee opting for New he will lose some exemptions/deductions/carry forward loss etc.

A summary of Section 115BAC is discussed below.

Total Income Rate of Tax
Upto Rs. 2,50,000 Nil
From Rs. 2,50,001 to Rs. 5,00,000 5 per cent
From Rs. 5,00,001 to Rs. 7,50,000 10 per cent
From Rs. 7,50,001 to Rs. 10,00,000 15 per cent
From Rs. 10,00,001 to Rs. 12,50,000 20 per cent
From Rs. 12,50,001 to Rs. 15,00,000 25 per cent
Above Rs. 15,00,000 30 per cent

Available only for Individuals and HUF

 
A person Who are opting for 115BAC cannot claim following Exemptions/Deductions
Section  
10(5) Leave travel concession
10(13A) House rent Allowance
10(14) Any other compensatory allowances
10(17) Daily Allowance of MPs and MLAs
10(32) Minors income not clubbed upto Rs.1500.00
10AA Special provisions in respect of newly established Units in SEZ
16 Standard deduction for Salary
24(b) Interest on borrowed capital - Self Occupied House property only  (interest on let out property can claim)
32(1)(iia) Additional Depreciation
32AD Investment in new plant or machinery in notified backward areas in certain States
33AB Tea development account, coffee development account and rubber development account
33ABA Site Restoration Fund
35(1)(ii) Amount paid to research association or to university for Research
35(1)(iia) Any sum paid to a company to be used by it for scientific research
35(1)(iii) Any sum paid to a research association which has as its object the undertaking of research in social science or statistical research
35(2AA) Any sum to a National Laboratory or a University or an IIT.
35AD Deduction in respect of expenditure on specified business.
35CCC Expenditure on the agricultural extension project
57(iia) Deduction for Family pension ( 1/3 rd or 15,000)
   

Any Provision of Chapter VIA Other than  

80CCD(2) Employer's Contribution to pension Scheme of Central Government.
80JJAA Deduction in respect of employment of new employees
Without any Setoff of any Loss -  

 
(a)  Carried forward or depreciation from any earlier assessment year, if such loss or depreciation is attributable to any of the deductions referred to above Sections or clauses
(b) Under the head "Income from house property" with any other head of income
No Credit for above-mentioned losses will be given in subsequent years. It shall be deemed to have been given full effect in CY
Can Claim depreciation under all provisions of section 32 except u/s 32(1)(iia) (Additional depreciation)
No exemption or deduction for allowances or perquisite available
A person having income from business or profession who opted for this can withdraw at any AY. But after withdrawal he can not opt again for this.
E & OE.   Sri Rajarajeswari

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