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Income Tax Calculator



Annual Income/Salary  


(With All Allowances)

HRA Received  


(per annum)

Basic Salary  


(per annum)

Income from other sources  


Rent Paid  


(per annum)

Annual Income estimated 


Income from other sources  


Include income from other sources like Bank (savings/FD/RD), Post office MIS, Post office RD, Rental income received etc

Deductions u/s 80C  


Medical Insurance Premium U/S 80D  


(for Self)

Interest paid on housing loan  


(sec 24)

Medical Insurance Premium U/S 80D  


(for Parents)

Additional Deductions U/S 80CCD NPS  


Interest Paid on Education Loan U/S 80E  


Deductions U/S 80CCD(2) NPS  


(Employer Contribution)

Other deductions  


Old Regime

Taxable Income

Tax Deductions

Taxable Income

Tax Deductions

Tax Payable

New Regime

Taxable Income

Tax Deductions

Taxable Income

Tax Deductions

Tax Payable

Disclaimer : This calculation is only for less than 60 years of age and generated on the basis of the information provided and is for illustrative purpose only and therefore is not specific advice in regard to your personal tax and investment matters. Please note that Tax laws are subject to amendments from time to time. Further, income tax calculation is a subject matter of expert opinion and it is recommended to consult with your tax advisor for details, before acting on above.

Income tax calculator

What is income tax?

Income tax is a type of tax that is imposed on the income of working individuals in a country. Governments need money to function. From employee salaries to public spending, governments have a variety of expenses. The income tax collected from eligible individuals forms one of the primary sources of the government’s revenue. Most of the governments levy income tax on the individuals earning within their jurisdiction. The income tax charged depends on a host of factors like the amount of income, type of income, age and investments. Certain investments are eligible for tax deductions and exemptions and help in reducing the income tax liability. All businesses and individuals have to file an income tax return every year to know their tax liability or to get a tax refund if any.

What is an income tax calculator?

What is an income tax calculator?

An income tax calculator is a free online tool that helps in determining the tax outgo in a year based on your income. Generally, income tax laws are tweaked with every Union Budget. The algorithm of online tax calculators is updated regularly, which ensures that you get the information as per the latest changes. To provide the income tax liability, the new tax calculator asks for certain information like the income and the various investments. With the number of income tax provisions increasing, it is better to calculate the income tax outgo online before filing the returns. Income tax calculator provides the exact information of the available deductions and exemptions. One can modify his/her investments as per the tax projection generated by the income tax calculator.

How to use Bajaj Allianz Life's Income Tax Calculator?

Tax planning has become an important part of financial planning. Making the right investments to achieve life goals, while simultaneously reducing tax liability is the core of tax planning. Bajaj Allianz Life’s Income Tax Calculator is an efficient tool for tax planning. With the income tax calculator, you do not have to worry about missing any of the tax deductions or exemptions. The online tax calculator from Bajaj Allianz Life is easy to use and has a simple user interface. Here is how you can use it.

  • Visit and go to "Income tax calculator" from the "Tools & Calculators" tab.
  • The income tax calculator will ask you for the type of city and the type of occupation. You will have to opt between metro or non-metro city and salaried or self-employed/business.
  • Depending on the type of occupation chosen, the tax calculator will ask for different information. If you are a salaried person, you will have to provide all details such as Annual income (with all allowance details), HRA received (per annum), Basic salary (Per Annum), Income from other sources and Rent paid (per annum).
  • On the other hand, if you opt for self-employed/business, you will just have to provide an estimation of your annual income and income from other sources.
  • In the next step, the income tax calculator will ask for information about the various investments made by you in the financial year that are eligible for deductions under Section 80C, 80D, 80CCD, 80E etc. of the Income Tax Act.
  • After providing all the details, the income tax calculator will calculate your tax liability under the old regime as well as the new regime.

    How to calculate income tax for FY 2021-2022?

    Certain changes have been introduced in the income tax regime in the recent past. A new income tax regime was introduced in the Union Budget 2020. The new system has lower tax rates, but it comes with some conditions. Individuals, who opt for the new tax system, will have to forego all the deductions available under the existing tax regime. Let us look at how to calculate tax on income and understand how much one will have to pay under each regime.

    Income Tax for salaried individuals

    The income from salary includes the basic salary, along with HRA, transport allowance, special allowance and any other allowance. Some of the components of salary like telephone bill allowance are exempt from income tax. Moreover, if you receive HRA and are paying rent, you can claim exemption on it. Over the various allowances, a standard deduction of Rs 50,000 has been allowed from the Union Budget 2019. Let us use an example for the better understanding of income tax under the old as well as the new regime. Let us assume that Mohan has a basic salary of Rs 1 lakh per month, HRA of Rs 50,000, special allowance of Rs 21,000 per month and leave travel allowance of Rs 20,000 annually. Mohan lives in Mumbai and pays Rs 40,000 in rent.




    Taxable Income (Old Regime)

    Taxable Income (New Regime)

    Basic salary










    Special allowance










    Standard deduction





    Gross total income from salary





    *assuming Mohan is claiming Rs. 12,000/- against LTA.

    Income from various sources have to be included to calculate the income tax.

    • Income from salary paid by the employer
    • Income from capital gains, which includes income from sale or purchase of shares or house
    • Income from house property such as rental income
    • Income from business/ profession
    • Income from other sources which includes interest on savings account or fixed deposit

    Mohan had earned some amount as interest on savings account and interest from fixed deposits. The interest earned on savings was Rs 8,000 in the year, while the fixed deposit led to an interest income of Rs 12,000. Rs.1,50,000 is claimed under Section 80 C of the Income Tax Act,1961


    Maximum deduction

    Eligible investments

    Amount claimed by Mohan

    Section 80C

    Rs 150,000

    PPF deposit of Rs 50,000, ELSS investment of Rs 20,000, life insurance premium of Rs 12,000 and EPF deducted by employer (Mohan’s contribution) =1,00,000*12%*12=1,44,000

    Rs 1,50,000

    Section 80D

    Rs 25,000 for self and Rs 50,000 for parents

    Health insurance premium of Rs 12,000

    Rs 12,000

    Section 80TTA

    Rs 10,000

    Savings account interest Rs 8000

    Rs 8000

    Calculation of gross taxable income (Old system)




    Income from salary



    Income from other sources



    Gross total income


















    Gross taxable income



    Total tax (including cess)



    Calculation of gross taxable income (new regime)




    Income from salary



    Income from other sources



    Gross total income



    Total tax (including cess)



    Under the new tax regime, the Indian government has increased the income tax slabs and reduced the tax rate for the lower slabs. Mohan’s tax liability was calculated as under:

    Upto Rs 2,50,000

    Exempt from tax


    Rs 2,50,000 to Rs 5,00,000

    5% of (Rs 5,00,000 - Rs 2,50,000)

    Rs 12,500

    Rs 5,00,000 to Rs 7,50,000

    10% of (Rs 7,50,000 - Rs 5,00,000)

    Rs 25,000

    Rs 7,50,000 to Rs 10,00,000

    15% of (Rs 10,00,000 - Rs 7,50,000)

    Rs 37,500

    Rs 10,00,000 to Rs 12,50,000

    20% (Rs 12,50,000 - Rs 10,00,000)

    Rs 50,000

    Rs 12,50,000 to Rs 15,00,000

    25% (Rs 15,00,000 - Rs 12,50,000)

    Rs 62,500

    More than Rs 15,00,000

    30% (20,92,000 - Rs 15,00,000) Rs 1,77,600


    4% of total tax Rs 14,604

    Total income tax

      Rs 3,79,704

    Income tax terminology explained

    Income tax returns have to be compulsorily filed by every earning individual of the country. However, a number of terms are associated with income tax filings, which may be confusing for many people. Here are some of the most commonly used income tax terms. 

    Assessment year

    The period of 12 months (April to March), immediately succeeding the year of which the income is being taxed is known as the assessment year. The assessment year is the 12-month period following the financial year.

    Financial year

    A financial year for filing your income tax is the year in which you earn an income. Individuals have to pay the income tax for all the earnings within a 12-month period i.e. from 1 April to 31 March.


    Employees must be familiar with the term. House rent allowance is the allowance provided to employees by employers to cover the expense of renting an accommodation. The HRA is exempt from income tax subject to limits specified in the tax laws. 

    Leave travel allowance

    It is an allowance provided to employees by employers to cover travel expenses within the country. LTA does not include the expenses incurred on boarding and lodging. LTA is exempted from income tax, but the exemption is allowed twice in the block of 4 calendar years. Current block of LTA is of Calendar year 2018-2021.

    Municipal taxes

    All taxes paid to any municipal entity is known as municipal taxes. All taxes paid to municipal authorities are eligible for deduction from income from house property.

    Interest on loans

    The interest paid on loans taken to buy or construct a house. The interest on loan is eligible for deduction from income from house property. Additionally, if you are incurring a loss from the property, the interest on loan can be adjusted against income from salary up to Rs 2 lakhs.

    Life insurance premium

    The premiums paid to keep the life insurance policy active is known as life insurance premium. Premium paid for life insurance up to Rs 1.5 lakh in a year is allowed deduction under Section 80C of the Income Tax Act. 

    Tuition fees

    The tuition fees paid in any school, college or university of India for a full time course for children or spouse is eligible for deduction of up to Rs 1.5 lakh under Section 80C of the income tax laws.


    Tax deduction of up to Rs 1.5 lakh can be claimed under Section 80C of the income tax act for investment in equity-linked savings scheme of mutual funds.

    Taxable income

    The income that will be taxed after all the exemptions and deductions provided under the law.

    Standard Deduction

    The Finance Bill 2018 introduced the standard deduction in the place of transport allowance and medical reimbursement. The Finance Bill 2019 increased the standard deduction limit to Rs 50,000.

    Income from salary

    The salary received from an employer along with the tax prerequisites make the income from salary. The form 16 and form 12BA issued every year contains all the details of the salary, alliances and the tax prerequisites offered in a year. 

    Income from house property

     It is one of the heads taken into account to calculate the gross income of an individual in a year.

    Income from capital gains

    It is one of the five heads of income. Any profit or gain accrued by the conversion of capital assets such as property, shares, securities, etc. is considered as income from capital gains for the computation of gross income of an individual. Income from capital gain can be further classified into short term and long term gains depending on the holding period.

    Income from other sources

    Any income not part of income from salary, profession/business, capital gains and house property falls under the income from other sources category. It generally includes interest earned through savings accounts and deposits and dividends.


    The government promotes certain expenditures and investments for a variety of reasons like financial security and social security. As per the income tax act, if an individual incurs these expenditures or makes the specified investments, he/she is allowed deductions from the gross income for the computation of the taxable income. Some of the common deductions available to taxpayers are under Section 80C, Section 80D, Section 80CCC, Section 80CCD, Section 80CCE, Section 80E, and Section 80G amongst others.


    Just like deductions, the income tax act also has a provision for several exemptions. Few of the common exemptions allowed under the law are house rent allowance, leave travel allowance, gratuity and withdrawal from the National Pension Scheme.

    Surcharge and cess

    If the income of the assesse is more than Rs 50 lakh per year but less than Rs 1 crore, a surcharge of 10% of the income tax amount is levied. If the annual income exceeds Rs 1 crore, a surcharge of 15% of the amount of the income tax is levied. Additionally, a health and education cess of 4% is levied on the amount of income tax plus surcharge, if any.

    Form 26 AS

    While filing income tax returns, Form 26 AS finds multiple mentions. Form 26 AS is the tax credit statement that details all the credit available to an individual to be valid while filing the ITR. The credit detailed in Form 26 AS consists of the Tax Deducted at Source (TDS) by the employer and the Tax Collected at Source (TCS). It also includes the self-assessment tax.

    Form 16

    It is a certificate issued by the employer detailing the gross salary paid along with the breakup of the salary into taxable and exempt income along with the Tax Deducted at Source.

    Income tax slabs under new regime

    The government introduced a new tax system with a higher number of income tax slabs and lower tax rates in the Union Budget 2020. The new tax regime is optional and people opting for the new tax system will have to forego the various deductions and exemptions available under the existing tax regime. The new tax rates have come into effect from April 1 2020, for the financial year 2020-21.

    Income tax rate and tax slabs under the new tax regime

    Income tax rate and tax slabs under old tax regime (Less Than 60 Years Old)

    Income Tax Slab

    Tax Rate

    Income up to ` 2,50,000

    No Tax

    Income from ` 2,50,001 - ` 5,00,000


    Income from ` 5,00,001 - ` 10,00,000


    Income more than ` 10,00,001


    Income tax rate and tax slabs under the new tax regime

    Total income (Rs)

    Tax rate

    Up to `2,50,000


    `2,50,001  to  `5,00,000


    `5,00,001  to  `7,50,000


    `7,50,001  to  `10,00,000


    `10,00,001 to  `12,50,000


    `12,50,001  to `15,00,000


    Above `15,00,000


    Just like the old tax regime, individuals with an annual income below Rs 5 lakh will be able to get a rebate of Rs 12,500 under Section 87A in the new tax regime also. It effectively makes an income of less than or equal to Rs 5 lakh tax-free. Under the existing tax regime, the limit of basic exemption varies according to the residential status and age of the taxpayer. The basic exemption is higher for senior citizens and super senior citizens. The differential basic exemption limit is not available under the new tax regime. Hence, the basic exemption limit will remain Rs 2.5 lakh for all taxpayers under the new regime. However, with the rebate under Section 87A, income equal to or below Rs 5 lakh for individuals in all age groups is essentially tax-free. Moreover, salaried individuals can switch between the old and the new tax regimes as per their convenience.

    Income tax slabs under old regime

    The Union Budget 2020 had introduced a new tax regime with major modifications in the income tax slabs and tax rates. However, the new tax regime is optional and taxpayers can still use the existing tax system. The various tax deductions and exemptions available under the existing tax regime is not available under the new tax system. Under the existing tax system, the basic exemption limit depends on the residential status and the age of the taxpayer. 

    Types of tax payers according to age

    Taxpayers have been categorised into three broad groups under the existing tax system. 

    • Resident individuals below the age of 60 years
    • Resident senior citizens above 60 years but below 80 years
    • Resident super senior citizens above the age of 80 years

    Here is the income tax slab for resident individuals below the age of 60 years

    Taxable income slabs

    Income tax rate + cess

    Up to Rs 2.5 lakh


    Rs 2,50,001-Rs 5,00,000

    5% of (total income - Rs 2,50,000) + 4% cess

    Rs 5,00,001-Rs 10,00,000

    Rs 12,500 + 20% of (total income - Rs 5,00,000) + 4% cess

    Rs 10,00,000 and above

    Rs 1,12,500 + 30% of (total income - Rs 10,00,000) + 4% cess

    Income tax slab for resident individuals between 60 and 80 years

    Taxable income slabs

    Income tax rate + cess

    Up to Rs 3 lakh


    Rs 3,00,001 - Rs 5,00,000

    5% of (total income - Rs 3,00,000) + 4% cess

    Rs 5,00,001 - Rs 10,00,000

    Rs 10,000 + 20% of (total income - Rs 5,00,000) + 4% cess

    Rs 10,00,001  and above

    Rs 1,10,000 + 30% of (total income - Rs 10,00,000) + 4% cess

    Income tax slab for resident individuals of 80 years and above

    Taxable income slabs

    Income tax rate + cess

    Up to Rs 5 lakhs


    Rs 5,00,000 to Rs 10,00,000

    20% of (total income - Rs 5,00,000) + 4% cess

    Rs 10,00,000 and above

    Rs 1,00,000 + 30% 0f (total income - Rs 10,00,000) + 4% cess

    Above tax calculated will be increased by surcharge if applicable and Health and Education Cess @4%.

    It is worth noting that a rebate of Rs 12,500 under Section 87A is available for individuals earning less than or equal to Rs 5 lakh per annum. It has made income upto Rs 5 lakh essentially tax-free for all taxpayers. Moreover, under the existing tax regime, a number of tax deductions and exemptions are available, which substantially reduce the tax liability.

    Income tax deductions

    Every working individual earning above a certain threshold has to pay income tax diligently. One can reduce the income tax liability through certain deductions. A taxpayer can avail a number of deductions to reduce his/her taxable income and hence the tax outgo every year. While one can manually calculate the maximum deduction allowed as per his/her investments and expenditures, the new income tax calculator can execute the task smoothly without any hassles. Here are the key deductions available under the income tax laws in India.

    Section 80C

    Section 80C is one of the most popular and wide-ranging sections to avail deductions. Under the section, individuals as well as HUFs can reduce the tax outgo by Rs 1.5 lakhs. To avail the section, taxpayers can invest in a variety of instruments like ELSS, PPF, EPF, ULIPs and NPS.

    Section 80CCC

    Deduction is allowed under the section for any amount paid by an individual for an annuity plan from a life insurance company. However, the payment should be to a fund mentioned in Section 10 (23AAB). The proceeds from the annuity or the surrender amount is taxed. Any bonus or interest received too is taxed.

    Section 80CCD

    The section provides deduction for contribution to the pension fund.

    Section 80CCD (1)

    It allows deduction for the employee contribution to the pension fund. The deduction allowed will be less than 10% of the salary if you are an employee or 20% of the gross income in the case of self-employed.

    Section 80CCD (1B)

    It allows an additional deduction of Rs 50,000 for contribution to the National Pension Scheme or the Atal Pension Yojana.

    Section 80CCD (2)

    Additional deduction can be claimed for the employer’s contribution to the pension account up to a limit of 10% of the salary. 

    Section 80D

    The section allows tax deduction for premiums paid for health insurance. If you have taken a policy for yourself, spouse or dependent children, you can claim deduction of Rs 25,000 in a year. An additional deduction of Rs 25,000 can be claimed for parents under 60 years of age. For parents above 60, the deduction allowed is Rs 50,000. If both the taxpayer and parents are over 60, a total deduction of Rs 1 lakh can be claimed. Deduction of Rs 5000 can be claimed for health check-up of family members.

    Section 80TTA

    The section allows individuals and HUFs to claim deduction of up to Rs 10,000 for interest earned through a savings account. The account can be maintained with a bank, co-operative society or post office. To avail the deduction, do not forget to list the interest income under the head income from other sources. 

    Section 80E

    Deduction can be claimed for the interest on education loan taken for higher studies of yourself, spouse, children or legal ward. There is no monetary limit on the deduction but it should be less than 1) 8 years from the beginning of loan repayment 2) until the entire interest is paid off.

    Section 80TTB

    Deduction of up to Rs 50,000 can be claimed by senior citizens on income from deposits.

    Income tax exemptions

    Just like deductions under various sections of the Income Tax Act, you can also utilize exemptions to reduce your tax liabilities. Income tax exemptions are largely dealt by Section 10 of the tax law. Here are some of the key tax exemptions available in India.

    House Rent Allowance

    House Rent Allowance

    One should understand the HRA calculation clearly to enjoy income tax exemption. The exemption received for HRA will be a minimum of 

  • Total HRA received from the employer
  • 50% of the income of individuals living in metro cities and 40% of those living in non-metro cities
  • Rent less than 10% of income.
  • Child Education Allowance

    Child Education Allowance

     A maximum of Rs 100 per month for two children can be availed as exemption on child education allowance.

    Hostel Allowance

    Hostel Allowance

    Subsidies on hostels are exempt up to Rs 300 per month for a maximum of two children.

    Interest paid on housing loans

    Interest paid on housing loans

    An income tax exemption of up to Rs 2 lakh on the interest paid for home loan can be availed on the condition that the house is constructed or acquired within 5 years from the end of financial year in which home loan is taken.

    How to file your income tax?

    Filing income tax returns is mandatory for people with income more than the limit allowed for exemption. It is also compulsory to file the returns online. However, there are certain exceptions.

  • Individuals above the age of 80
  • Individuals with an income of less than Rs 5 lakh and not claiming a refund

    Income tax return can be filed online in a few simple steps

  • Visit the website and register on the website
  •  Use the permanent account number or PAN as the user ID
  •  To get an idea of the tax credit, view the Form 26AS, also known as the tax credit statement
  • The amount in the TDS certificate must tally with the figures in Form 26AS
  • Click on the income tax return form and choose the financial year
  • Download the relevant ITR form
  • After downloading, open the attached excel sheet and fill out all the details using the TDS certificate/Form 16
  • Check the tax payable amount by clicking the ‘calculate tax’ tab
  • Pay the applicable tax and fill in the challan details
  • Confirm all the data by pressing the ‘validate’ button
  • Generate a XML file and save on your system
  • In the next step, go to the ‘upload return’ section in the portal’s panel and upload the saved XML file
  • A pop-up will ask you to digitally sign the file for verification

  • If you have a digital signature press ‘yes’ and if not, then click ‘no’

  • The acknowledgement form, ITR Verification (ITR-V) will be generated
  • Take a print out of the form and sign it in blue ink
  • Send the form by ordinary speed post to the following the address within 120 days of the online submission
  • Income-Tax Department-CPC,
    Post Bag No. 1,
    Electronic City Post Office,

    Bangalore - 560 100. Karnataka.


    Follow the given steps to file ITR 1 online

  • The ITR 1 form can be submitted online by uploading XMS
  • Login to e-filing application
  • Go to ‘e-file’ and ‘Prepare and Submit ITR Online’
  • Select the correct income tax return form and the assessment year
  • Fill in the details and then click the submit button and select Digital Signature Certificate
  • Click on ‘submit’
  • After submission, acknowledgement detail is displayed
  • Click on the link to generate the a printout of the acknowledgement/ITR-V form

    How life insurance helps you reduce your income tax liability

    With the risks to life rising, life insurance has become a necessity. The financial benefits of life insurance ensures that your loved ones lead a comfortable life even in your absence. Life insurance provides the much-needed financial buffer, but it is not all. Investing in a life insurance plan also offers a host of tax benefits.

  • The premiums paid for life insurance are eligible for tax deduction under Section 80C of the Income Tax Act, 1961. The maximum amount of deduction that can be claimed under the section in a year is Rs 1.5 lakhs.
  • In case the annual premium is more than 10% of the sum assured, you will only be able to claim a tax deduction equivalent to 10% of the sum assured. For instance, if you pay Rs 80,000 for a policy with a death cover of Rs 5 lakh, you will only be able to claim Rs 50,000 as deduction instead of the entire Rs 80,000.
  • The income on maturity of life insurance is tax-free under Section 10(10D) of the income tax law if the premium is not more than 10% of the capital sum assured or the capital sum assured is at least 10 times the premium.
  • The tax benefits available under Section 10(10D) is applicable to all the amounts paid through a life insurance policy, including maturity benefits, death benefits, any bonus received, surrender value and survival benefits.

    Investing in life insurance reduces the tax liability substantially. However, tax benefits are a supplementary advantage of investing in life insurance. There are a number of life insurance products available in the market and there are multiple benefits of life insurance. Let us take a look at some of the benefits of life insurance plans.

    ULIPs or unit-linked insurance plans offer dual benefit of insurance coverage along with capital growth.

  • ULIPs invest your savings into market-linked securities such as debt and equity through various investment funds.
  • The policyholder gets the option to choose between investment funds as per his/her risk tolerance.
  • ULIPs also allow a certain number of free switches between the investment funds, which can be utilised to adjust the portfolio as per market conditions.
  • ULIP plans offer potential for higher growth over the long term.

  • If you are not comfortable with market-linked products and just want insurance coverage for your family, term insurance plans would be a suitable product. Term insurance plans are the simplest types of life insurance plans.

    • Term insurance plans offer high sum assured at affordable rates.
    • Term insurance plans do not have an investment component and are hence very easy to understand.
    • Policyholders can enhance the coverage through optional riders.
    • Term insurance plans offer adequate flexibility in the payout of the insurance benefits.

    Income tax calculator - frequently asked questions

    • How much tax should I pay on my salary?

      The annual tax outgo depends on the income tax slab you belong to. Refer tax slabs under old regime and new regime.

    • What is the maximum non-taxable income limit?

      The maximum non-taxable limit for an individual is Rs 2.5 lakh in a year. However, a rebate of Rs 12,500 under Section 87A is provided for an income less than or equal to Rs 5 lakh, technically making an annual income of up to Rs 5 lakh tax-free. The rebate was increased to the current level from FY 20-21. Additionally, if you have made investments that qualify for tax deduction under Section 80C, you can claim a maximum deduction of Rs 1.5 lakh in a year, making an income of Rs 6.5 lakh tax-free.

    • What is an income tax return?

      Every earning person in the country has to pay income tax to the government. There are two types of taxes in India--direct and indirect. Income tax is a direct tax and individuals need to directly pay the tax to the concerned authority on income earned during financial year. Income Tax Return (ITR) is a form which a person is supposed to submit to the Income Tax Department of India.

    • Does everyone have to file income tax returns?

      People earning less than Rs 2.5 lakh per year are below the basic exemption limit and do not have to mandatorily file income tax. However, if they want to claim a refund, even people with income below exemption will have to file returns. People earning more than Rs 2.5 lakh have to mandatorily file income tax.

    • What details do you need while filing income tax returns?

      Filing income tax returns is not a very complicated process. One just needs to provide basic information such as PAN, Aadhaar Card details, and current address. Additionally, details of all the bank accounts held in a financial year along with income earned like current salary and income from investments has to be provided. All the deductions claimed under Section 80 or Chapter VI-A and tax payments such as TDS and advance tax are also needed.

    • What is the last date to file income tax returns?

      Normally the due date for filing ITR is 31st July of that particular financial year.

    • What is the difference between exemption and deduction?

      Both deductions and exemptions reduce the tax burden but are not the same. Income tax deductions are claimed on gross total income. One becomes eligible for tax deduction only after making certain specified investments and expenditures. The value of investments is deducted from the gross total income, resulting in a lower taxable income. One the other hand, exemptions are provided on certain components of the salary, making them tax-free. Tax-exempt income is not included in taxable income, reducing the tax liability. 

    • What exemptions and deductions are not available under the new tax regime?

      All deductions under Chapter VIA other than employers contribution to Pension Fund under Section 80CCD(2), LTA , HRA, Standard deduction and professional tax payment and interest payment on self-occupied housing property are not allowed under new tax regime.

    • Can I switch between the old and new tax regime every financial year?

      Taxpayers are free to switch between the old and the new tax regime every year. However, there are certain conditions for switching. Taxpayers with business income will not be able to switch between the old and the new tax regime as per their convenience. If you do not have business income, you are free to switch between the tax systems as per your convenience.

    • What is the difference between financial year and assessment year?

      The taxation process in India works as per the financial year, which is a period of 12 months between April 1 and March 31. The financial year is the period when you earn salaries and income. The assessment year is the 12 months that follow a financial year. In the assessment year, the income earned in the financial year is assessed and taxed.   

    • How to compute gross total income and taxable income?

      The gross total income is the income earned by an individual under the various heads of income in a financial year. To compute gross total income, one just has to add the income from various sources. It includes all the income from house rent, business, salary or capital gains. The taxable income can be computed by deducting the applicable income tax deductions from the gross total income. If you have made certain investments that qualify for income tax deductions, just subtract the permissible limit of deduction from the gross total income to get the taxable income.

    • What is standard deduction in income tax?

      Standard deduction is a flat amount that can be deducted from the gross salary as exemption. Currently, one can avail a standard deduction of Rs 50,000. The standard deduction has replaced the transport allowance and medical reimbursement that was allowed earlier.

    • I am a self-employed professional. Do I have to pay advance tax?

      Advance tax has to be paid on income that is not subject to TDS. Self-employed people and businesses have to pay advance tax as their liabilities can be substantial due to their business income.

    This calculation is only for less than 60 years of age and generated on the basis of the information provided and is for illustrative purpose only and therefore is not specific advice in regard to your personal tax and investment matters. Please note that Tax laws are subject to amendments from time to time. Further, income tax calculation is a subject matter of expert opinion and it is recommended to consult with your tax advisor for details, before acting on above.

    The Tax write-up above is  provided only for user’s continence and information purpose.

    The user will have to verify the facts, law and content with the prevailing tax laws and seek appropriate professional advice before acting on the basis of the above information. Note that tax laws are subject to amendments from time to time.

    Last updated: 2021-05-20