PROCEDURE FOR COMPUTATION OF TAX LIABILITY

Step 1:

Compute taxable income under each head of income and then add all of them to arrive at GROSS TOTAL INCOME

Step 2:

Reduce deductions from Gross total income u/80  c,80CCC,80CCD,80D,80DD,80DDB,80E,80EEA,80EEB,80G,80GG,80GGC,80GGA,80RRB,80RB,80TTA,80TTB ANDN80U

Step 3:           

            Compute tax on income at the rates applicable

Step 4:

            Add Surcharge if the income Exeeds Rs.5 lakh

Step 5

            Add Health and Education Cess at 4% of Total Tax 

 TAX RATES

Income

Rate

Tax on LTCG- if Not Indexed

-          If indexed

20%

12.5%

Tax on STCG 

20%

Tax on Casual income

30%

                           TAX RATE -A. Y 2025-2026

1.For individuals(both men and women) below 60 years of age.

 

INCOME SLAB

TAX RATE

1.

Net income is less than 2,50,000

Nil

2.

NI Rs,2,50,001 to Rs.5,00,000

5%

3.

NI Rs.5,00,001 to Rs.10,00,000

20%

4.

Above Rs.10,00,000

30%

2.For Senior citizens (above 60 years of age)

 

INCOME SLAB

TAX RATE

1.

Net income is less than Rs.3,00,000

Nil

2.

NI Rs.3,00,000  to Rs.5,00,000

5%

3.

NI Rs.5,00,001 to Rs.10,00,000

20%

4.

Above Rs.10,00,000

30%

 

2.For Super Senior citizens (above 80 years of age)

 

INCOME SLAB

TAX RATE

1.

Net income is less than Rs.5,00,000

Nil

2.

NI Rs.5,00,001 to Rs.10,00,000

20%

3.

Above Rs.10,00,000

30%

 


          COMPUTATION OF TAX LIABILITY

 

Rs.

Tax on LTCG-

XXX

Tax on STCG 

XXX

Tax on Casual income

XXX

Tax on Balance Amount( Slab Rate)

(Gross Total Income- LTCG-STCG-Casual Income)

XXX

Tax on Income

XXXX

Less: Tax Rebate ( if Net income is Less than 5,00,000) Rs.12,5000 or Tax Whichever is less

 

XXX*

 

XXX

Add: Health & Education Cess- 4% on Tax

XXX

TAX LIABILITY

XXX

 Tax Rebate 87

If the Net income is below Rs.5, 00,000,  Rebate u/s 87 will be

Rs.12,500 or Tax whichever is less

 

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