What is Income Tax?
Income tax is the tax levied by the government on the total income earned by the assessee.
Types of Income
There are 5 head of income in which the earning or total income can be catogarised as per Income Tax Act, 1961.
- Income from Salary
- Income from Business and Profession
- Income from House Property
- Income from Capital Gain
- Income from Other Sources
If any individual makes investment in some of the specified investment schemes or does expenses for some specific purposes, then it would be available as deduction from the gross total income earned by the assessee as given under :
|MF-ELSS, PPF, PF,LIP, Tax saving Fixed Deposit, Repayment of housing loan, tuition fees of children, etc.|
|Mediclaim of self, child and spouse|
For parents (Rs. 30,000/- in case of senior citizen instead of 25000)
|80G||Donation to charitable Institute|
50% of net total income
|Interest on Higher Education||Actual Interest paid|
|Interest on Housing Loan||Max uptoRs. 2 Lacs|
Taxability of the income (For the A.Y. 2018-19)
Income tax is levied on the income earned by the assessee as per the slab of the income as mentioned hereunder
|For Ind/HUF||Senior Citizen||Very senior Citizen||Rate of Income Tax|
|Upto 300000||Upto 500000||Nil|
|Above 1000000||Above 1000000||Above 1000000|
Rebate uptoRs. 2500/- is available to the assessee if total income of the assesseedoes not exceeds Rs. 3,50,000/-
On the Income tax calculated as above education cess and secondary and higher education cess is to be calculated @ 3%.
The surcharge will be 10% of the taxable Income between Rs. 50 lakhs to Rs. 1 crore
The surcharge will be 15% of the taxable Income above Rs. 1 crore