What is an income tax calculator?
This income calculator 2023-24 is a free tax calculator that helps you calculate income based on your income. It is your responsibility to pay income tax to the government based on your income, so this calculator will help you calculate your income so you don’t face any surprises and plan accordingly.
There are 2 tax regimes for the financial year 2023-24 – old tax regime and new tax regime. When you have a certain income or claim. The fiscal year (fiscal year) (the period for which April Income Tax is due) will be taxed in March of next year. In this case, from April 2023 to March 2024.
During this period, you have to pay income tax on all the income you earned in that financial year Try it right now, you will reach 2 under the 2 tax rule. household income tax. You can plan and decide where you will choose to pay less taxes.
Two tax systems – This system fixed tax rates that have not changed for a long time. It allows you to choose various investment options that will help you save money by deducting investments in various products.
New tax policy – This policy was announced in the 2020 Budget with a slight reduction in tax rates. This regime was introduced to help you lower the burden of income tax you were paying in previous years using Old tax regime. But new tax regime does not allow any deductions (except Standard Deduction in FY 2023-24) to be claimed if you make any investments, to save more income tax. You pay tax on entire amount you earn in FY.
The New Tax Slab Rates are same for all age groups.
For Age between 60 – 80 years, 5% slab is for income between Rs. 3,00,000 to Rs. 5,00,000 under Old Slab Rates.
For Age above 80 years, 5% slab rate is not applicable in Old Slab Rate. So people in this age group can belong to only 20% or 30% Slab Rate.
HOW TO CALCULATE INCOME TAX EXAMPLES
Let’s take example of income = Rs. 8 Lacs in FY (April 2023-March 2024)
Tax Calculation with Old Tax Regime Since income = Rs. 8 Lacs, based on old slab rates – you pay 0% tax on income between Rs. 0 to Rs. 2.5 Lacs, 5% tax on income between Rs. 2.5 Lacs to Rs. 5 Lacs and 20% tax on income between Rs. 5 Lacs to Rs. 8 Lacs.
So below is the calculation:
0% Tax (Rs. 0 – Rs. 2.5 Lacs) = Rs. 0
5% Tax (Rs. 2.5 Lacs to Rs. 5 Lacs) = Rs. 12,500 (on Rs. 2.5 Lacs difference)
20% Tax (Rs. 5 Lacs to Rs. 8 Lacs) = Rs. 60,000 (on Rs. 3 Lacs difference)
This makes your intermediate tax as Rs. 72,500. Now an additional 4% cess is applicable on this amount which is Rs. 2,900, which makes your total income tax based on Old Tax Regime = Rs. 75,400
Income Tax Calculation using Old Tax Regime
In above calculation, we have not considered Standard Deduction of Rs. 50,000 which must be applied if you are Salaried employee or pensioner.
Let us now see income tax calculation using New Tax Regime Tax Calculation with New Tax Regime With same example of income = Rs. 8 Lacs, based on new slab rates – you pay 0% tax on income between Rs. 0 to Rs. 3 Lacs, 5% tax on income between Rs. 3 Lacs to Rs. 5 Lacs and 10% tax on income between Rs. 6 Lacs to Rs. 8 Lacs.
So below is the calculation:
0% Tax (Rs. 0 – Rs. 3 Lacs) = Rs. 0
5% Tax (Rs. 3 Lacs to Rs. 6 Lacs) = Rs. 15,000 (on Rs. 3 Lacs difference)
10% Tax (Rs. 6 Lacs to Rs. 8 Lacs) = Rs. 20,000 (on Rs. 2 Lacs difference)
This makes your intermediate tax as Rs. 35,000. Now an additional 4% cess is applicable on this amount which is Rs. 1,400, which makes your total income tax based on New Tax Regime = Rs. 36,400.
Income Tax Calculation using New Tax Regime
In this case, you pay less income tax with new tax regime. We have not considered standard deduction of Rs. 50,000 in our example, which will be applicable in New tax regime as well from FY 2023-24 if you are salaried employee or pensioner.
