Section 202 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 202 sets the rate of income-tax for an individual, a Hindu undivided family and certain other persons on their total income for a tax year, and then says which deductions and set-offs are not available when that rate Table is used. This article explains the section as per the Income-tax Act, 2025 as amended by the Finance Act, 2026. Later amendments, the Income-tax Rules, 2026 and notifications should be checked separately.
Section 202(1) applies to individuals, Hindu undivided families, associations of persons (other than a co-operative society), bodies of individuals and the artificial juridical persons of section 2(77)(g). Unless the person exercises the option under sub-section (4), tax on total income is computed at the seven-row slab Table: nil up to Rs. 4,00,000, rising in steps of Rs. 4,00,000 to 30% above Rs. 24,00,000. Sub-section (2) lists the exemptions, deductions and set-offs that are not allowed while this Table is used.
Who is covered by section 202(1)
The sub-section begins with "Irrespective of anything contained in this Act other than Chapter XVII-B but subject to Parts A, B, E and this Part of this Chapter". It then names five kinds of person: (a) an individual; (b) a Hindu undivided family; (c) an association of persons, other than a co-operative society; (d) a body of individuals, whether incorporated or not; and (e) an artificial juridical person referred to in section 2(77)(g). For each of them the tax on total income for a tax year is computed at the rates in the Table, unless the person exercises the option in the manner provided under sub-section (4).
Co-operative societies have their own sections; see our note on the tax on resident co-operative societies in sections 203 and 204. Companies are dealt with in section 200 and the neighbouring sections.
The slab Table in section 202(1)
The Table has three columns: serial number, total income and rate of tax.
| Serial number | Total income | Rate of tax |
|---|---|---|
| 1 | Up to Rs. 4,00,000 | Nil |
| 2 | From Rs. 4,00,001 to Rs. 8,00,000 | 5% |
| 3 | From Rs. 8,00,001 to Rs. 12,00,000 | 10% |
| 4 | From Rs. 12,00,001 to Rs. 16,00,000 | 15% |
| 5 | From Rs. 16,00,001 to Rs. 20,00,000 | 20% |
| 6 | From Rs. 20,00,001 to Rs. 24,00,000 | 25% |
| 7 | Above Rs. 24,00,000 | 30% |
The Table gives the rate on each band. Surcharge, cess and any rebate are not printed in this section; they are governed by other provisions, and for the rebate you can read our note on section 156. For a salaried or self-employed taxpayer, the practical use of the Table is simple: compute total income under the rules of the Act, apply the bands in turn and add the results. If you want the figure checked before filing, our income tax return filing service can do that.
A worked example
The amounts below are assumed for illustration and use only the bands printed above. Meera, an individual with no business income, has total income of Rs. 10,00,000 for the tax year, computed as section 202(2) requires.
- Up to Rs. 4,00,000: nil.
- Rs. 4,00,001 to Rs. 8,00,000, which is Rs. 4,00,000 at 5%: Rs. 20,000.
- Rs. 8,00,001 to Rs. 10,00,000, which is Rs. 2,00,000 at 10%: Rs. 20,000.
Tax by the Table: Rs. 40,000, before any rebate, surcharge or cess.
What section 202(2) switches off
For the purposes of sub-section (1), total income is computed without the following.
(a) Exemptions and deductions under:
| Reference | What is not allowed |
|---|---|
| Schedule III (Table: serial number 5, 6, 7, 8, 11 or 17) | The exemptions at those serial numbers of Schedule III |
| Schedule III (Table: serial number 12 or 13) | Those exemptions, other than those prescribed for this purpose |
| Section 19(1) (Table: serial number 1) | The deduction at that serial number |
| Section 22(1)(b), for properties referred to in section 21(6) | Deduction of interest on such properties |
| Section 33(8) | The deduction in that sub-section |
| Sections 48 and 49 | Both sections |
| Section 45(3)(a), (b) or (c) | Those deductions |
| Section 46 and section 47(1)(a) | Those deductions |
| Chapter VIII | Every deduction in the Chapter, other than section 124(1) and 124(2), or 125(2) or 146 |
Sub-clause (iii) of clause (a) is shown as omitted: it was omitted by the Finance Act, 2026, w.e.f. 1-4-2026, and the footnote prints the omitted reference as "section 144".
(b) Set-off of: (i) any loss carried forward or depreciation from an earlier tax year, if it is attributable to any deduction listed in clause (a); and (ii) any loss under the head "Income from house property" against any other head of income.
(c) Allowances and perquisites provided under any other law in force, called by any name, are also not exempted or deducted.
Sub-section (3) adds that the loss and depreciation referred to in (2)(b) are deemed to have been given full effect and no further deduction for them is allowed for any later year. The deductions that survive, such as those in sections 124 and 146, are explained in our notes on section 124 and section 146.
The option in section 202(4): leaving the Table
Sub-section (1) does not apply to a person who exercises an option under this section, in the manner prescribed, for a tax year. The detail of the manner is left to the Income-tax Rules, 2026. The timing depends on the kind of income.
- A person with income from business or profession must exercise it on or before the due date under section 263(1) for furnishing the return for that tax year. Once exercised, the option applies to subsequent tax years. It may be withdrawn only once, for a tax year other than the one for which it was exercised. After that withdrawal the person is never again eligible to exercise the option, except where the person ceases to have any income from business or profession, in which case the option under clause (b) is available.
- A person without income from business or profession exercises the option along with the return of income to be furnished under section 263(1) for the tax year.
The due dates and the kinds of return are explained in our notes on section 263.
International Financial Services Centre units: section 202(5)
For a person with a Unit in the International Financial Services Centre, sub-section (2) is modified to the extent that the deduction under section 147 is available to the Unit, subject to the conditions in that section. See section 147.
Where section 202 meets other sections
- Section 206(2) refers back to section 202(1): the alternate minimum tax does not apply to a person whose tax is computed under section 202(1). Read section 206.
- Chapter XIII sets special rates for some incomes, which are dealt with in their own sections, for example section 194. Section 202(1) is expressly "subject to Parts A, B, E and this Part".
- For readers who know the earlier Act by its section number, see our mapping note on where the earlier Act's provision sits in the 2025 Act.
Mistakes to avoid
- Treating the Table as the only computation. Sub-section (2) changes what counts as total income first.
- Missing the cut-off in sub-section (4)(a)(i) for business or profession income.
- Assuming a withdrawal can be repeated. For business or profession income, withdrawal is possible only once.
- Forgetting that the loss and depreciation disallowed under (2)(b) are not carried forward for later years.
Need help with choosing between the Table and the option?
Section 202 turns on the facts of each tax year, particularly whether there is income from business or profession. For a comparison of your position under both computations, our tax planning advisory team can work through it with you.
Key takeaways
- The seven-row Table in section 202(1) applies by default to individuals, HUFs, AOPs (other than co-operative societies), BOIs and artificial juridical persons.
- Nil up to Rs. 4,00,000, and 30% above Rs. 24,00,000.
- Section 202(2) denies listed exemptions, deductions and set-offs while the Table is used; clause (2)(a)(iii) was omitted w.e.f. 1-4-2026 by the Finance Act, 2026.
- The option in sub-section (4) has different timing for business or profession income and other income.
Read next
- Section 200: the company tax regime
- Section 206: minimum alternate tax and alternate minimum tax
- Section 263: return of income, who must file and due dates
- Chapter XIII of the Income-tax Act, 2025: determination of tax in special cases
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.