Section 115BAC of Income Tax Act at a Glance

Sudiesh , Last updated: 16 December 2020 Share Follow on Google News

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