Income tax is a tax levied on financial income of a person, corporation or other legal entities. The slab and rates of income tax for individual and corporation are given below according to Indian Income Tax Act for AY 2009-2010.

(i)INCOME TAX FOR INDIVIDUAL:

1) For individuals other than women and senior citizen:

(1) For taxable income less than INR 110,000: Tax is nill

(2) For next INR 40,000 rate is 10%

(3) For next INR 100,000 tax rate is 20%, For amount more than INR 250,000 rate is 30% 

(4) For taxable income more than INR 1,000,000 a surcharge of 10% of income tax is added to the tax payable amount

2) For ladies other than senior citizen:

(1) For first INR 145,000 tax is nil

(2) For next INR 5,000 rate is 10%

(3) For next INR 100,000 rate is 20%, For amount more than INR 250,000 rate is 30%

(4) For taxable income more than INR 1,000,000 a surcharge of 10% of income tax is added to the tax payable amount

3) For senior citizen:

(1) For first INR 195,000 tax is nil

(2) For next INR 55,000 rate is 20%

(3) For taxable income more than INR 250,000 rate is 30%

4) For other individual i.e. HUF, AOP, BOI:

For such individuals tax slabs are same as individuals other than women and senior citizen. i.e.

(1) For first INR 110,000 tax is nil

(2) For next INR 50,000 rate is 10%

(3) For next INR 100,000 rate is 20%, For amount more than INR 250,000 tax rate is 30%

(4) For taxable income more than INR 1,000,000 a surcharge of 10% of income tax is added to the tax payable amount

(ii) CORPORATE TAX:

1) For domestic companies having taxable income less than INR 1 crore (10 million): Income is taxed at a flat rate of 30% with a 3% education cess so total 30.9%

2) For domestic companies having taxable income more than INR 1 crore (10 million): Income is taxed at a flat rate of 30% with a 10% surcharge on tax and 3% education cess on tax plus surcharge so total 33.99%

3) For foreign companies: Income is taxed at a flat rate of 40% with a 3% education cess so total 41.2%