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Union Budget 2025-26 (Full) + Finance Bill, 2025
E. Companies
In the case of companies, the rates of income-tax have been specified in Paragraph E of Part I of the First Schedule to the Bill and remain unchanged vis-à-vis those for the AY 2024-25. In case of domestic company, the rate of income-tax shall be 25% of the total income, if the total turnover or gross receipts of the previous year 2022-23 does not exceed four hundred crore rupees and in all other cases the rate of income-tax shall be 30% of the total income.
2. In the case of companies other than domestic companies, the rate of income-tax shall be 35%, on the total income other than income chargeable at special rates.
(1) Surcharge on income-tax
The rates of surcharge on the amount of income-tax for the purposes of the Union are the same as that specified for the AY 2024-25. The surcharge shall not apply on income-tax computed on income of specified fund (referred to in clause (c) of the Explanation to clause (4D) of section 10) that is chargeable under clause (a) of sub-section (1) of section 115AD of the Act. Further, for person whose income is chargeable to tax under sub-section (1A) of section 115BAC of the Act, the surcharge at the rate of 37% on the income or aggregate of income of such person (excluding the income by way of dividend or income under the provisions of sections 111A, 112 and 112A of the Act) exceeding five crore rupees is not applicable. In such cases the surcharge is restricted to 25%.
(2) Marginal Relief—
Marginal relief has also been provided in all cases where surcharge is proposed to be imposed.
(3) Education Cess—
For assessment year 2025-26, “Health and Education Cess” is to be levied at the rate of 4% on the amount of income-tax so computed, inclusive of surcharge wherever applicable, in all cases. No marginal relief shall be available in respect of such cess.
(3) Education Cess—
For assessment year 2025-26, “Health and Education Cess” is to be levied at the rate of 4% on the amount of income-tax so computed, inclusive of surcharge wherever applicable, in all cases. No marginal relief shall be available in respect of such cess.
Full Text:
Corporate tax rate differential maintained between smaller domestic companies and others, with surcharge rules and health and education cess applied. Rates of income-tax for companies confirm lower rate for domestic companies below the turnover threshold and higher rates for other domestic and non-domestic companies; surcharge framework remains as prior year with exclusions for income of specified funds and capped surcharge treatment for incomes under the special domestic tax regime. Marginal relief is provided where surcharge is imposed. A Health and Education Cess is levied at a fixed percentage on income-tax inclusive of surcharge in all cases, with no marginal relief available for the cess. of Press 'Enter' after typing page number.
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