.jpg "Income Tax slabs for sole proprietorships professionals partnership firms and companies for FY 2022-23 (AY 2023-24) - TaxManager")
- IN THE NEWS X
- It’s time to clear your advance tax liability
- Seniors need to submit Forms 12BBA, 15G, 15H to save on TDS: Experts
- How investing in 54EC bonds can help you save tax on long-term gains
- New income tax forms are out for new assessment year 2022-23. Find out which one you should use
- New ITR forms need income disclosure from foreign retirement a/cs
- Why is March 31 an important date for taxpayers? Find out
- Not filed ITR yet? Face penalty or even jail term, say analysts
- March 15 Is The Last Date To Pay Advance Tax: Time To Clear Your Liability
- It's time to deduct TDS if rent exceeds Rs 50,000, say analysts
- Clarification on capital gains tax on early redemption of Sovereign Gold Bonds is required – Here’s why
- Second amendment to LLP Rules will ease procedural burden: Experts
- Three Things To Keep In Mind Before Investing In RBI’s Sovereign Gold Bonds
- Tackle low liquidity in sovereign gold bonds by laddering, say analysts
- CBDT, tax tools make e-filing of I-T returns simpler
Income Tax Slabs for sole proprietorships professionals partnership firms and companies for FY 2022-23 (AY 2023-24)
Written by Gagandeep Arora - Printed on - Date - 23rd Dec 2022
Income tax slabs for sole proprietorships and professionals
The income tax slabs under the old income tax regime for sole proprietorship businesses and professionals are same as salaried class. However, individuals running proprietorship businesses or offering professional services (such as lawyer, doctor etc.) are eligible for many deductions that salaried individuals are not. Similarly, there are certain deductions that can be claimed only by salaried employees.
Old income tax regime slabs for proprietorship business, professionals below 60 years
Total income range (Rs)
Income tax rate (excluding surcharge and cess)
| Total income range (Rs) |
Income tax rate (excluding surcharge and cess) |
| 0 to 2,50,000 |
NIL |
| 2,50,001 to 5,00,000 |
5% |
| 5,00,001 to 10,00,000 |
20% |
| 10,00,001 and above |
30% |
Cess at 4% will be added to the income tax amount. Surcharge will be applicable if total income exceeds Rs 50 lakh.
Old income tax regime slabs for senior citizens who are sole proprietors or are professionals
| Total income range (Rs) |
Income tax rate (excluding surcharge and cess) |
| 0 to 3,00,000 |
NIL |
| 3,00,001 to 5,00,000 |
5% |
| 5,00,001 to 10,00,000 |
20% |
| 10,00,001 and above |
30% |
Cess at 4% will be added to the income tax amount. Surcharge will be applicable if total income exceeds Rs 50 lakh.
Old income tax regime slabs for super senior citizens who are sole proprietors or are professionals
| Total income range (Rs) |
Income tax rate (excluding surcharge and cess) |
| 0 to 5,00,000 |
NIL |
| 5,00,001 to 10,00,000 |
20% |
| 10,00,001 and above |
30% |
Cess at 4% will be added to the income tax amount. Surcharge will be applicable if total income exceeds Rs 50 lakh.
New income tax regime slabs for sole proprietorships and professionals
Income tax slabs applicable under the new income tax regime
| Total income range (Rs) |
Income tax rate (excluding surcharge and cess) |
| 0 to 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% |
| 15,00,001 and above |
30% |
The income tax slabs mentioned in the table below are applicable for domestic companies that are registered under the Companies Act, 2013.
Income tax slab for domestic companies for FY 2022-23
| Condition |
Income tax rate (excluding surcharge and cess) |
| If turnover or gross receipt in FY2020-21 exceeds Rs 400 crore |
30% |
| If turnover or gross receipt in FY 2020-21 does not exceed Rs 400
crore |
25% |
| If opted for section 115BA |
25% |
| If opted for section 115BAA |
22% |
| If opted for section 115BAB |
15% |
| Any other domestic company |
30% |
Cess at 4% will be added to the income tax amount. Gross receipt, turnover and total sales are the same thing.
Section 115BA of the Income-tax Act is applicable on domestic manufacturing companies that were established and registered on or after March 1, 2016. Once a company opts to pay tax under Section 115BA, it cannot change the calculation process unless it opts for Section 115BAA for computing the income tax liability.
Section 115BAA offers relief to certain domestic companies wanting to lower their tax burden applicable under Section 115BA. Do note that if a company opts to pay under Section 115BAA, it will have to forgo certain deductions and other benefits as specified under the law.
Section 115BAB offers a lower income tax rate to promote new manufacturing start-ups.
A company can opt to pay income tax under this section if it satisfies certain
conditions. Some of these conditions are:
a) The company was set up and registered on or after October 1, 2019, and has started
manufacturing or production on or before March 31, 2024
b) Plant and machinery used for manufacturing was not previously used; it must be new
| Condition |
Surcharge rate |
| If net taxable income exceeds Rs 1 crore but does not exceed Rs 10
crore |
7% |
| If net taxable income exceeds Rs 10 crore |
12% |
| If company opts for taxability under Section 115BAA or Section
115BAB |
10% |
Presumptive income tax scheme
It is important for proprietorship businesses and professionals to remember that they
have to maintain meticulous books of accounts. Under the Income-tax Act, a business
(sole proprietorship, partnership firm, company) or a professional is required to
maintain a profit and loss statement, balance sheet and other books as applicable.
However, if a taxpayer does not want to maintain the books of accounts, the act provides
an alternative way of taxation. But this is only for certain proprietorships businesses
and professionals which meet specified conditions.
Section 44AD is available for sole proprietorship businesses whereas Section 44ADA is
available to professionals such as doctors and lawyers.
