{"id":19309,"date":"2023-02-10T14:58:12","date_gmt":"2023-02-10T09:28:12","guid":{"rendered":"https:\/\/magicsheds.in\/index.php\/2023\/02\/10\/students-guide-to-income-tax\/"},"modified":"2023-02-10T14:58:12","modified_gmt":"2023-02-10T09:28:12","slug":"students-guide-to-income-tax","status":"publish","type":"post","link":"https:\/\/magicsheds.in\/index.php\/2023\/02\/10\/students-guide-to-income-tax\/","title":{"rendered":"Student’s Guide to Income Tax"},"content":{"rendered":"

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The government levies income taxes on individuals and corporations with respect to the income or profits made by such individuals and businesses. Individuals and corporations are required to file income tax returns each year in order to calculate the amount of income tax to be paid.<\/p>\n<\/p>\n

Income Tax: How It Works<\/b><\/h2>\n
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  • Taxable income is defined as income that is subject to taxation. Total income minus allowable deductions and exemptions equals taxable income. Income tax is calculated as per the applicable income tax rate.<\/li>\n
  • Different income tax rates may apply at different levels. Additionally, not every taxpayer pays tax at the same rate. In other words, the rates and regulations applicable to the income taxes of companies and individual taxpayers may differ. The corporate tax rate that companies typically pay in most countries is a fixed tax rate.<\/li>\n
  • How much income tax a person has to pay also depends on how much taxable income he earns in a particular year. Depending on how much money a person makes in a year, their income tax rate varies. Tax brackets are the different ranges of a person\u2019s income that determine the appropriate income tax rate.<\/li>\n
  • Additionally, the personal tax rate is often progressive because it applies only to an additional unit of income and increases as income increases.<\/li>\n
  • Investment income is taxed in addition to income received by individuals and businesses; This tax is usually in the form of capital gains tax. Capital gains taxes are low, which encourages investment.<\/li>\n<\/ul>\n

    Indian Income Tax Basics<\/strong><\/h2>\n

    Income tax collection in India is governed by the Income Tax Act, 1961. The Act creates several classes for different persons or assessees. For the purposes of this Act, a person or assessee includes:<\/p>\n

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    • a person<\/li>\n
    • association of persons [AOP]<\/li>\n
    • Hindu Undivided Family (HUF)<\/li>\n
    • a trade<\/li>\n
    • any additional assessee as defined by this Act<\/li>\n<\/ul>\n

      Income Tax: Income Classification<\/strong><\/h2>\n
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      • Pension, salary and other benefits are taxed.<\/li>\n
      • Income from house property \u2013 This category of taxation applies to rental income from houses.<\/li>\n
      • Profits and gains from business or profession \u2013 This category of taxation applies to income from any business activity or profession.<\/li>\n
      • Gains from the sale of capital assets like mutual funds, real estate, houses etc. are subject to taxation.<\/li>\n
      • Income from other sources \u2013 This category of taxation applies to income that is taxable but not taxable under the other four heads. For example, interest on fixed deposit, interest on savings account, lottery winnings, etc.<\/li>\n<\/ul>\n

        income tax slab 2023-24<\/strong><\/h3>\n\n\n\n\n\n\n\n\n\n\n
        Income tax brackets of the new tax regime for the financial year 2023-24<\/b><\/td>\n<\/tr>\n
        Income Tax Slab (in Rs.)<\/b><\/td>\nIncome Tax Rate (%)<\/b><\/td>\n<\/tr>\n
        Between 0 to 3,00,000<\/td>\n0<\/td>\n<\/tr>\n
        Between 3,00,001 and 6,00,000<\/td>\n5%<\/td>\n<\/tr>\n
        Between 6,00,001 and 9,00,000<\/td>\n10%<\/td>\n<\/tr>\n
        Between 9,00,001 and 12,00,000<\/td>\n15%<\/td>\n<\/tr>\n
        Between 12,00,001 to 15,00,000<\/td>\n20%<\/td>\n<\/tr>\n
        above 15,00,001<\/td>\n30%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

        Following are the changes between the current new tax regime (effective till FY 2022-23) and the new tax regime planned for FY 2023-2024:<\/p>\n

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        • The basic exemption limit has been raised from Rs 2.5 lakh to Rs 3 lakh.<\/li>\n
        • There are now only five income tax slabs instead of the earlier six.<\/li>\n
        • The taxable income limit for tax credit provided by section 87A has increased from Rs. Five lakh to Rs. Seven lacs. Tax refund has quadrupled from Rs 12,500 to Rs 25,000.<\/li>\n
        • Under the new tax regime, the maximum surcharge rate was reduced from 37% to 25%. For salaried people and retired people the standard deduction of Rs. 50,000 were set up in the financial year 2023-2024.<\/li>\n<\/ul>\n

          See also:<\/i><\/b> Income Tax Calculator: Step-Wise Guide To Using The Official Tax Calculator<\/i><\/b><\/span><\/p>\n<\/p>\n

          questions to ask<\/b><\/h2>\n
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          How can one file his Income Tax Return?<\/h3>\n
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          \t\t\t\t\t\tIncome tax returns can be filed online using the e-filing portal of the Income Tax Department of India.\t\t\t\t\t<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/section>\n

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          What documents are required to file Income Tax Return?<\/h3>\n
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          \t\t\t\t\t\tFor filing Income Tax Return, the following documents are required PAN (Permanent Account Number), Aadhaar Card, Bank Account Details (Account Number, IFSC Code), TDS\/TCS Certificate (Form 16\/16A), Details of Income from Various Sources (Form 16\/16A). salary, interest income, rental income, etc.), details of investment and expenditure which can be claimed as deduction, any other relevant document. \t\t\t\t\t<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/section>\n

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          How can one check the status of his Income Tax Return?<\/h3>\n
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          \t\t\t\t\t\tYou can check the status of your Income Tax Return by logging in with your PAN and password on the e-filing portal of the Income Tax Department of India.\t\t\t\t\t<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/section>\n

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