Income Tax Calculator (New Regime)

Tax Inputs
Tax Breakdown
Slab Tax Amount

New Tax Regime Rules (FY 2023-24)

Tax slabs for individuals under 60 years:

Income Slab (₹) Tax Rate
0 - 3,00,000 0%
3,00,001 - 6,00,000 5%
6,00,001 - 9,00,000 10%
9,00,001 - 12,00,000 15%
12,00,001 - 15,00,000 20%
Above 15,00,000 30%

Example Calculation: ₹15,00,000

Slab Calculation Tax Amount
First 3,00,000 0% 0
Next 3,00,000 5% of 3,00,000 15,000
Next 3,00,000 10% of 3,00,000 30,000
Next 3,00,000 15% of 3,00,000 45,000
Remaining 2,50,000 20% of 2,50,000 50,000
Subtotal 1,40,000
Cess (4%) 5,600
Total Tax 1,45,600

Understanding Income Tax

Income tax is a tax levied by governments on the income generated by individuals and businesses. It is a primary source of funds that governments use to finance public services, infrastructure, and welfare programs. Understanding and managing your income tax is an important aspect of financial planning.

Key Components of Income Tax Calculation

How to Use This Income Tax Calculator

  1. Enter Annual Gross Income: Input your total annual income from all sources in the 'Annual Gross Income' field. This should include your salary, business profits, capital gains, rental income, etc., for the financial year.
  2. Enter Total Deductions: Enter the total amount of deductions you are eligible to claim under various sections of the income tax law (e.g., Section 80C, 80D, etc.) in the 'Deductions' field. If you are unsure, you can start with a standard deduction amount or consult your financial documents.
  3. Click 'Calculate Tax': Press the 'Calculate Tax' button.
  4. View Results: The calculator will display:
    • Taxable Income: Your Gross Income after subtracting the entered deductions.
    • Income Tax: The estimated income tax amount based on the taxable income and applicable tax slabs (using a simplified, general tax structure).
    • Effective Tax Rate: The percentage of your gross income that goes towards income tax.

Income Tax FAQs

Income tax is a tax levied by the government on the income of individuals and entities. It's a direct tax, meaning it's paid directly by the person or entity earning the income. Income tax is a significant source of revenue for governments, used to fund public services, infrastructure, and social welfare programs.

Generally, individuals, Hindu Undivided Families (HUFs), companies, firms, and other entities earning income above a certain threshold (which varies by jurisdiction and is updated periodically) are liable to pay income tax. Tax liability depends on the income level and applicable tax laws.

Income can be earned from various sources, which are often categorized under heads of income. Common sources include:
  • Salary: Income earned as an employee.
  • Business and Profession: Profits from business or professional activities.
  • Capital Gains: Profits from the sale of capital assets like stocks or property.
  • House Property: Income from renting out property.
  • Other Sources: This is a residual category and includes income like interest from savings accounts, dividends, etc.

Tax deductions are allowed under various sections of income tax laws to reduce your taxable income. Some common examples include:
  • Section 80C: Investments in schemes like Public Provident Fund (PPF), Employee Provident Fund (EPF), Life Insurance Premiums, Equity Linked Savings Schemes (ELSS), etc.
  • Section 80D: Premiums paid for health insurance.
  • Section 80G: Donations to certain charitable organizations.
  • House Rent Allowance (HRA) Exemption: For those living in rented accommodation.
  • Interest on Home Loan: Deduction for interest paid on loans for buying a house.
  • Standard Deduction: A flat deduction allowed to salaried individuals and pensioners.
  • Note: Specific deductions and limits vary by region and are subject to change in tax laws. Refer to the relevant tax authority for the most up-to-date information.

There are several legitimate ways to reduce your income tax liability:
  • Plan Investments to Claim Deductions: Invest in tax-saving schemes under sections like 80C, 80D, etc., up to permissible limits.
  • Utilize all Available Deductions: Be aware of all deductions you are eligible for and ensure you claim them (e.g., HRA, interest on education loans, etc.).
  • Claim Rebates: If your income is below a certain threshold, you may be eligible for tax rebates that reduce your tax payable.
  • Invest in Tax-Efficient Instruments: Some investments are tax-free or tax-deferred, which can help reduce your overall tax burden.
  • Seek Professional Advice: Consult a tax advisor or financial planner. They can provide personalized advice based on your income, investments, and the latest tax laws to optimize your tax planning.

Tax planning should always be ethical and compliant with the law. Avoid aggressive tax avoidance schemes that are not legally sound.