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PERSONAL INCOME TAX

A resident (staying for more than 182 days in a year) is taxed on his world-wide income if he is also ordinarily resident in India (e.g. if he maintains resident status for 9 out of 10 preceding years).

A non-resident is taxed only on income that is received in India.

Though the entire remuneration is taxable, concessional treatment is accorded to leave passage, reimbursement of medical expenses and benefits received in kind, such as, company-leased flat, car, furnished housing, utilities etc.

A tax deduction is allowed at the rate of 20 percent on all eligible savings subject to a limit of Rs 60,000 savings per annum.

New rates for personal income tax:

• - 10% on the first slab of Rs.40,000-Rs.60,000 +10% Surcharge
  - 20% on the second slab of Rs.60,000 + 10% Surcharge
  - Rs.1,50,000 - 30% on the third slab of income > Rs 1,50,000 +10% Surcharge