Are Tax Calculators Really Helpful
Like the calculators you use in order to get measures or calculations, there is a calculator for taxes that can calculate your income taxes. However, this tool works more than only calculating taxes because it shows how your taxes are being affected and the areas that are being included in the tax deductibles or tax benefits. In India, by visiting the official page of the Income Tax authority, you can get the tax calculated.
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Tax is a mandatory contribution that you need to make for your government for helping the authority to handle the expenditure of public funds. One might have to pay for various sections that include wealth tax, income tax, corporation tax, service taxes and customs tax. If you fail to use tax calculator new tax plan and pay tax charges on time, you might face legal consequences.
What Do I Need to Pay for Income Tax?
If you can make use of tax calculator, you can understand how much you are liable to pay to the government. The tax calculator comparison can let you know how the tax slabs are applicable to you.
- If your income slab ranges Rs. 10,00,00 and more than that, you will have to pay 30% of the tax rate.
- The tax rate goes up to 20% when your income is Rs. 5,00,000 – Rs. 10,00,000.
- You can see that the tax rate is around 5% when your annual salary is Rs. 2,50,000- Rs. 5,00,000 only if you make use of tax calculator online free.
- Individuals can understand that tax calculator exemptions are applicable only if their income is no more than Rs. 2,50,000.
Now, this tax calculation is only viable for the people who are under 60 years in FY 2017-2018 and FY 2018-1019. However, the taxpayers under the age of 60 had pay 30%, 20% and 10% in FY 2014-1015, FY 2015-2016 and FY 2016-2017.
Educational Cess and Tax Calculator
The term cess indicates ‘tax on tax’ and here you have to pay the tax liability. Additionally, you should know that the tax calculator does not deal with the amount of your annual income. At present, you are required to two percent of education cess and one percent of higher and secondary education cess.
In addition to the context, you should know that three percent of income tax is involved when it comes to the calculation of tax liability by utilising tax calculator. In case you are paying for the surcharge, three percent is calculated with the income tax as well.
Deal with Tax Calculator
Instead of relying on third-party websites, you can visit the official website of Income Tax India where you can get a tax calculator.
- You have to choose the assessment year first.
- Choose the taxpayer from the categories of individual, a domestic company, a foreign company, cooperative society, HUF and others.
- Then you are instructed to mention the commission, interest and other sources of income only if they are applicable in your case on the tax calculator online.
- For the tax calculator with deductions, you are given a section to duly fill the blank spaces if life insurance premium, contribution toward provident fund or PPF, payment for annuity plan, re-payment of housing loan, five years deposit with PO or scheduled bank and contribution to ULIP are applied to your case. Even if you have long-term infrastructure bonds, employer’s contribution to NPS (not more than 20%), investment in equity saving scheme and tuition fees for children, you need to mention all in designated sections. You have to do it get a clear knowledge of deductions on the tax calculator.
- You may have to show only the amount of profit for tax calculator estimate in gains and profits of profession or business.
- There is a section for tax calculator 0 exemptions where you only need to tick off whether you are eligible for 80DD.
- In case, there is any other tax calculator refund or deduction framework that can be applied in the estimation, you can mention that in tax calculator.
- In the end, you need to mention the net taxable income in the tax calculator for completing the entire calculation process.
In a nutshell, transport allowance, HRA, basic salary, special allowance and other allowance are included in the calculator. You should know that every part of your income is not included in the tax and there are chances of getting tax exemptions.
Now you can understand it is not difficult to utilise tax calculator because all the required accounts that affect your income tax amount are mentioned in the tax calculator. There is no doubt that the Income Tax authority has understood how rough things can get while calculating the estimation or how people even being eligible for tax calculator return, fail to make use of it.