Income Tax Rates for Others

Income Tax Rates for Others (Income Tax Act, 2025)

Partnership Firms and Limited Liability Partnerships (LLPs)

Under the Income Tax Act, 2025, partnership firms (including LLPs) are subject to a flat rate of income tax. Key provisions are:

• A partnership firm (including limited liability partnership) is taxable at a flat rate of 30%.
• Surcharge: 12% of income-tax, applicable if the total income exceeds ₹1.5 crore. Otherwise, Nil.
• Health & Education Cess: 4% of the income-tax liability (including surcharge).

1

Base Tax Rate

A flat rate of 30% on total income for all partnership firms and LLPs.

2

Surcharge Threshold

12% surcharge applies if total income exceeds ₹1.5 crore.

3

Cess Application

A mandatory 4% Health & Education Cess is levied on the tax plus surcharge.

Note: No concessional rates have been introduced for firms or LLPs in the new tax regime under the Income Tax Act, 2025.

Solution:

Since the net profit (₹8,50,000) does not exceed ₹1.5 crore, no surcharge is applicable.

Particulars	Amount (₹)
Net Profit	8,50,000
Income Tax @ 30%	2,55,000
Add: Surcharge (Nil)	0
Tax after Surcharge	2,55,000
Add: Health & Education Cess @ 4%	10,200
Total Tax Liability	2,65,200

Companies

The Income Tax Act, 2025, provides different tax rates for domestic and foreign companies, with options for concessional regimes for domestic companies.

Domestic Company

• Standard Rate: 30%
• Concessional Rate (Sec 115BAA/BAB): 22% / 15% (subject to conditions)
• Surcharge: 7% or 12% based on income slabs.
• Cess: 4%

Foreign Company

• Standard Rate: 40%
• Surcharge: 2% or 5% based on income slabs.
• Cess: 4%
• No concessional tax regime options.

Domestic Companies

Tax rates for domestic companies depend on their turnover and whether they opt for a concessional tax regime.

Category	Income Tax Rate
If total turnover/gross receipts in FY 2023-24 does not exceed ₹400 crore	22%
For manufacturing companies opting for Section 115BAB	15%
Any other domestic company	30%

Surcharge and Cess for Domestic Companies:

Total Income	Surcharge Rate
Exceeds ₹1 crore but up to ₹10 crore	7%
Exceeds ₹10 crore	12%

Note: Health & Education Cess @ 4% of tax liability (including surcharge) is applicable to all domestic companies.

Foreign Companies

Foreign companies are taxed at a higher rate with specific surcharge provisions.

Category	Income Tax Rate
Royalty received from Government or an Indian concern in pursuance of an agreement made by it with the Indian concern after 31.03.1976, where such agreement is approved by the Central Government.	25%
Fees for technical services received from Government or an Indian concern in pursuance of an agreement made by it with the Indian concern after 29.02.1964, where such agreement is approved by the Central Government.	25%
Any other income	40%

Surcharge and Cess for Foreign Companies:

Total Income	Surcharge Rate
Exceeds ₹1 crore but up to ₹10 crore	2%
Exceeds ₹10 crore	5%

Note: Health & Education Cess @ 4% of tax liability (including surcharge) is applicable to all foreign companies.

Solution:

Since the turnover in FY 2023-24 (₹2.25 crore) does not exceed ₹400 crore, the company is eligible for the 22% tax rate. No surcharge is applicable as income is below ₹1 crore.

Particulars	Amount (₹)
Net Profit	10,50,000
Income Tax @ 22%	2,31,000
Add: Surcharge (Nil)	0
Tax after Surcharge	2,31,000
Add: Health & Education Cess @ 4%	9,240
Total Tax Liability	2,40,240

Solution:

Since the turnover in FY 2023-24 (₹2.25 crore) does not exceed ₹400 crore, the company is eligible for the 22% tax rate. Surcharge is applicable as income exceeds ₹1 crore but is below ₹10 crore.

Particulars	Amount (₹)
Net Profit	1,58,50,000
Income Tax @ 22%	34,87,000
Add: Surcharge @ 7%	2,44,090
Tax after Surcharge	37,31,090
Add: Health & Education Cess @ 4%	1,49,244
Total Tax Liability	38,80,334

Solution:

Since the turnover in FY 2023-24 (₹92.25 crore) exceeds ₹400 crore, the company is subject to the 30% tax rate. Surcharge is applicable as income exceeds ₹10 crore.

Particulars	Amount (₹)
Net Profit	25,25,85,000
Income Tax @ 30%	7,57,75,500
Add: Surcharge @ 12%	9,09,30,600
Tax after Surcharge	16,67,06,100
Add: Health & Education Cess @ 4%	66,68,244
Total Tax Liability	17,33,74,344

Solution:

FINC US Inc is a foreign company. Since the net profit (₹1.25 crore) exceeds ₹1 crore but is below ₹10 crore, a 2% surcharge is applicable.

Particulars	Amount (₹)
Net Profit	1,25,70,000
Income Tax @ 40%	50,28,000
Add: Surcharge @ 2%	1,00,560
Tax after Surcharge	51,28,560
Add: Health & Education Cess @ 4%	2,05,142
Total Tax Liability	53,33,702

Co-operative Societies

Co-operative societies have the option to choose between the old tax regime and a new concessional tax regime under the Income Tax Act, 2025.

account_balance

Old Regime

Standard slab rates apply, with higher rates for higher income brackets.

trending_up

New Concessional Regime

Option to pay tax at 15% (Sec 115BAE) subject to certain conditions.

Old Tax Regime for Co-operative Societies

Total Income	Income Tax Rate
Up to ₹10,000	10%
₹10,001 to ₹20,000	20%
Above ₹20,000	30%

New Concessional Tax Regime (Section 115BAE)

Resident co-operative societies can opt to pay tax at a concessional rate of 15%, provided they do not avail certain deductions or incentives. This option is available from Assessment Year 2026-27.

Surcharge and Cess for Co-operative Societies:

Total Income	Surcharge Rate (Old Regime)	Surcharge Rate (New Regime)
Exceeds ₹1 crore but up to ₹10 crore	7%	10%
Exceeds ₹10 crore	12%	10%

Note: Health & Education Cess @ 4% of tax liability (including surcharge) is applicable to all co-operative societies.

Solution:

Tax liability for FINC Apartment Owners Association under the old regime:

Particulars	Amount (₹)
Gross Total Income	5,25,000
Tax on first ₹10,000 @ 10%	1,000
Tax on next ₹10,000 @ 20%	2,000
Tax on balance ₹5,05,000 @ 30%	1,51,500
Total Income Tax	1,54,500
Add: Surcharge (Nil, as income < ₹1 crore)	0
Tax after Surcharge	1,54,500
Add: Health & Education Cess @ 4%	6,180
Total Tax Liability	1,60,680

Solution:

For an LLP, the flat tax rate is 30%. Surcharge is applicable as income exceeds ₹1.5 crore.

Particulars	Amount (₹)
Net Profit	1,18,50,000
Income Tax @ 30%	35,55,000
Add: Surcharge (Nil, as income < ₹1.5 crore)	0
Tax after Surcharge	35,55,000
Add: Health & Education Cess @ 4%	1,42,200
Total Tax Liability	36,97,200

Association of Persons (AOP) and Body of Individuals (BOI)

The income tax rates for an AOP or BOI are generally the same as those applicable to individuals. However, specific rules apply based on the relationship between the members and their individual taxability.

• If the shares of the members are indeterminate or unknown, the AOP/BOI is taxed at the maximum marginal rate (MMR).
• If the shares of the members are determinate and known, the AOP/BOI is taxed at the rates applicable to individuals, unless any member’s total income exceeds the maximum amount not chargeable to tax, in which case the AOP/BOI is taxed at MMR.
• Surcharge: Applicable as per individual slabs (10%, 15%, 25%, 37%) if total income exceeds ₹50 lakh.
• Health & Education Cess: 4% of the income-tax liability (including surcharge).

AOP/BOI Taxability

Shares Indeterminate/Unknown: Taxed at MMR

Shares Determinate/Known: Taxed as Individuals (or MMR if member’s income exceeds basic exemption)

Illustrative Individual Tax Slabs (for reference, as AOP/BOI often follow these):

Total Income	Tax Rate
Up to ₹3,00,000	Nil
₹3,00,001 to ₹6,00,000	5%
₹6,00,001 to ₹9,00,000	10%
₹9,00,001 to ₹12,00,000	15%
₹12,00,001 to ₹15,00,000	20%
Above ₹15,00,000	30%