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Posted October 16, 2013 by advocateguru in Learning Centre
 
 

How to Save Tax and with complete steps of saving ?

Firstly, taxable income from all sources likes income from salaries, income from business and profession, income from house property, income from other sources,

Income from capital gains is calculated to arrive at gross total income

 

Step 2: taxable income is calculated from gross total income less deduction u/s80c to 80U

Step 3: from the total taxable income less long term capital gain less casual income gives the amount to calculate tax rate

Step 4: after arriving at the amount from total taxable income less capital gain less casual income applies the income tax slabs.

 

 

 

Different category has different slabs like

 

 

I. Individual resident below 60 years of age (i.e. born on or after 1st April 1953) or any NRI / HUF / AOP / BOI / AJP *

 

i. Income-tax:

 

Income Slabs Income Tax Rate

i. Where the total income does not exceed Rs. 2, 00,000/-. NIL

ii.Where the total income exceeds Rs. 2, 00,000/-

but does not exceed Rs. 5, 00,000/-. 10% of amount by which

the total income exceeds Rs. 2, 00,000/-

 

 

 

 

iii.Where the total income exceeds Rs. 5, 00,000/-

but does not exceed Rs. 10,00,000/-. Rs.30, 000/- + 20% of the amount by which the total income exceeds Rs. 5, 00,000/-.

iv.Where the total income exceeds Rs. 10, 00,000/-. Rs. 130,000/- + 30% of

the amount by which the total income exceeds Rs. 10, 00,000/-.

 

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income Tax.

 

II. Individual resident who is of the age of 60 years or more but below the age of 80 years

at any time during the previous year (i.e. born on or after 1st April 1933 but before 1st April 1953)

 

i. Income-tax:

 

Income Slabs Income Tax Rate

  1. Where the total income does not exceed

Rs. 2, 50,000/- NIL

ii. Where the total income exceeds Rs. 2, 50,000/-

does not exceed Rs. 5,00,000/- 10% of the amount by

which the total income exceeds Rs. 2,50,000/-.

iii. Where the total income exceeds Rs. 5, 00,000/-

but does not exceed Rs. 10,00,000/- Rs. 25,000/- + 20% of the

amount by which the total income exceeds Rs. 5,00,000/-.

iv. Where the total income exceeds Rs. 10, 00,000/- Rs. 125,000/- 30% of the

amount by which the total income exceeds Rs. 10,00,000/-.

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income Tax.

 

III. Individual resident who is of the age of 80 years or more at any time during the previous year

(I.e. born before 1st April 1933)

 

i. Income-tax:

 

Income Slabs Income Tax Rate

  1. Where the total income does not exceed

Rs.5, 00,000/-. NIL

ii Where the total income exceeds

Rs. 5, 00,000/- but does not exceed

Rs. 10, 00,000/- 20% of the amount by

which the total income

Exceeds Rs. 5, 00,000/-.

 

 

 

 

iii. Where the total income exceeds Rs. 10, 00,000/- Rs. 100,000/- + 30% of

the amount by which the total income exceeds Rs. 10,00,000/-.

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income Tax.

 

IV. Co-operative Society

 

i. Income-tax:

 

Income Slabs Income Tax Rate

  1. Where the total income does not exceed

Rs. 10,000/-. 10% of the income.

  1. Where the total income exceeds Rs. 10,000/-

but does not exceed Rs. 20,000/-. Rs. 1,000/- + 20% of income in excess of Rs. 10,000/-.

iii. Where the total income exceeds Rs. 20,000/- Rs. 3.000/- + 30%

Of theAmount by which the total income exceeds Rs. 20,000/-.

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income-tax.

 

V. Firm

 

i. Income-tax: 30% of total income.

 

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income Tax.

 

VI. Local Authority

 

i. Income-tax: 30% of total income.

 

ii. Surcharge: Nil

 

iii. Education Cess: 3% of the Income Tax.

 

VII. Domestic Company

 

i. Income-tax: 30% of total income.

 

ii. Surcharge: The amount of income tax as computed in accordance with above rates, and after being reduced by the amount of tax rebate shall be increased by a surcharge at the rate of 5% of such income tax, provided that the total income exceeds Rs. 1 crore.

 

iii. Education Cess: 3% of the total of Income Tax and Surcharge.

 

VIII. Company other than a Domestic Company

 

i. Income-tax:

 

@ 50% of on so much of the total income as consist of (a) royalties received from Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern after the 31st day of March, 1961 but before the 1st day of April, 1976; or (b) fees for rendering technical services received from Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern after the 29th day of February, 1964 but before the 1st day of April, 1976, and where such agreement has, in either case, been approved by the Central Government.

@ 40% of the balance

ii. Surcharge: The amount of income tax as computed in accordance with above rates, and after being reduced by the amount of tax rebate shall be increased by a surcharge at the rate of 2% of such income tax, provided that the total income exceeds Rs. 1 crore.

 

iii. Education Cess: 3% of the total of Income Tax and Surcharge

 

Step 5: after step 4 arrives tax liability.


advocateguru