Firstly, are you supposed to pay for Income Duty?
The clear answer depends upon the year. For your income for the season 2011-12 (1st May, 2011 to 31st March, 2012), you must pay tax if
you are a resident person with a taxable money greater than Rs. 1,80,00
you’re a resident woman with a taxable income of more than Rs. 1,90,000
you’re a resident senior citizen (age 60+) with a taxable money in excess of Rs. 2,50,00
you’re a resident very senior (age 80+) with a taxable money in excess of Rs. 5,00,000
Just how much duty am I expected to pay?
You’ll want heard about’Income Duty Slabs ‘. For a resident male, the slabs for the season 2011-12 are
Income Slab – 0 to 1,80,000
Rate – 0%
Income Piece – 1,80,001 to 5,00,000
Rate – 10%
Money Slab – 5,00,001 to 8,00,000
Rate – 20%
Revenue Piece – above 8,00,000
Charge – 30%
Which means if your money is significantly less than 1,80,000 there isn’t to pay for tax.
If your money is, claim, Rs. 2,30,000, you have to pay at 10% on the amount where it meets Rs. 1,80,000. In e filing income tax could be (2,30,000 – 1,80,000) *.10
And if your income is, say, Rs. 6,00,000, you’ve to cover tax on Rs. 3,20,000 ( 5,00,000 – 1,80,000 ) at 10%, and on Rs. 1,00,000 ( 6,00,000 – 5,00,000 ) at 20%.
Therefore, meaning every year I’ve to visit the Income Duty Department and pay it?
Most likely, no. To produce things simple on your own conclusion, the Department makes your company do the same. Your boss will take it from your pay and spend it for you. That is called TDS – Duty Deduced at Source.
What’s this Kind 16?
How do you know if your company is spending your tax on time? and what’s the quantity?
Your company provides you with a Variety 16 by the end of a year. This sort 16 has facts about the pay he’s paid to you, the duty he’s deducted onto it, and compensated to the Money Tax Department.
What’s Advance Tax / Self-Assessment Duty?
Your company will withhold tax on your pay money and pay it to the Income Tax Division, but what when you yourself have money from different options as effectively?
Say, you offered an item of area and built a decent revenue on it. At this point you have to cover duty on this profit. Regrettably, your boss will not pay it. You will need to do it.
Get another case. Your boss did not withhold tax in your salary. He will experience penalties from the Income Tax Division, but think about you? You will now you have to cover it to the Money Tax Department directly. It is a rare case.
This really is called Improve Tax / Self-Assessment Tax
Is there any huge difference between the above mentioned two?
If you pay it all through the entire year, i.e., between 1st April, 2011 and 31st March, 2012 (for 2011-12) it is called Advance Tax.
If, while organizing your duty reunite, you recognize that you still have to pay duty, and pay it therefore, it is known as Self-Assessment Tax. Thus Self-Assessment Duty is compensated following 31st March, 2012.
What’re money tax deductions?
Deductions are specific tax advantages you could be permitted to avail. If your revenue is Rs. 4,00,000, and you are permitted to deductions of Rs. 1,00,000, you’ll only have to spend tax on Rs. 3,00,000 at the piece rates.
There are many deductions. Example:
Advanced compensated on a Living Insurance Policy
Property Loan Repaid
Amount deposited in a PPF (Public Provident Fund) Account
Specific Good Funds ordered
Okay, therefore my company gives duty on my behalf. So, my job is done? I don’t need to do any such thing, proper?
Perhaps not really. You have to file an money duty return with the Revenue Duty Department. A get back is just a form that states the money you have acquired throughout the year, the tax you’re expected to cover on, that duty you actually compensated, the benefits you availed, etc…