Introducing a web portal for salaried employees to calculate income tax from their payslips. Let’s find out how to use the Income Tax Calculator to calculate your tax in easy steps.
Step 2: Fill in basic details
Step 3: Key in your Earnings
Copy the earnings from your pay slip to appropriate salary heads listed.
If a salary head is not listed, you should key in the value under ‘Other Allowance’.
Step 4: Key in your Deductions
Copy the deductions from your payslip to appropriate salary heads.
If a salary head is not listed, you should key in the value under ‘Other Deduction’.
Step 5: Make changes to Earnings and deductions
If your salary has changed during the financial year, you can make changes here.
Step 6: Compute Income Tax to calculate Tax Liability
As you see, the Tax Liability in Old regime is INR 71872 and liability in new regime is INR 41226. You are recommended to choose New regime as it provides a benefit of INR 30646.
Step 7: View Calculation Summary
Over here, you will know how the Tax liability is calculated from the data you provided.
Step 8: Investment Declarations
Now, let’s declare the investments that you have made or are about to make. The investment declarations can bring down the tax liability.
Let’s declare investment of INR 150000 in Life Insurance Policy
Let’s also declare INR 200000 in Home Loan Interest.
Step 9: Compute Income Tax again
This time the investment declarations will also be taken in to consideration while calculating tax liability.
As you see, the tax liability in Old regime has come down to nil, and you are recommended to choose the Old regime now.
The income tax calculator helps you understand the tax calculation process and also helps you save tax by letting you experiment your investment declarations. The income tax calculator advises you on how to save maximum tax.
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