Taxes can seem hard, but with the correct tools, taxpayers can simplify their calculations. One such useful tool for quickly estimating your tax liability is the online calculator provided by the income tax department.
The income tax calculator provides a straightforward method to get started, whether you're attempting to plan, compare the old and new tax systems, or just figure out how much tax you might owe.
Here's how you can use it and what you should know.
How is the income and tax calculator service beneficial to registered e-Filing users?
The income and tax calculator service enables registered and unregistered e-Filing users to perform the following actions:
Access their tax calculation with a basic and/or advanced calculator in a quick and easy manner without logging into the e-Filing portal.
Compare their tax as per the old tax regime and new tax regime introduced in the Finance Budget 2020.
How is the current income and tax calculator service different from the previous version on the old e-Filing portal?
The Income and Tax Calculator service is now a Quick link on the e-Filing portal.
You can estimate tax as per the new tax regime and the old tax regime and compare the results.
Can I consider the calculation from the income and tax calculator exact, and use it when filing my return?
No. The income and tax calculator enables you to have a quick view of your basic tax calculation, and does not necessarily give your final tax calculation in all circumstances. For filing of returns, the exact calculation may be made as per the provisions contained in the relevant Acts and Rules.
Step-by-step guide
Go to the e-Filing portal homepage.
Select Quick Links-Income and Tax Calculator.
You will be taken to the Income and Tax Calculator page. There are two tabs - Basic Calculator and Advanced Calculator. The Basic Calculator tab is selected by default.
- Basic Calculator
In the Basic Calculator tab, enter the required details such as:
Assessment Year (AY)
Taxpayer category
Age
Residential status
Total annual incom
Total deductions
The tax calculation as per the details entered by you will appear in the Tax Summary section.
Click View Comparison to get a more detailed comparison of tax under the old and new tax regime.
- Advanced Calculator
In the Advanced Calculator tab, enter the following details:
Preferred tax regime
Assessment Year (AY)
Taxpayer category
Age
Residential status
Due date and actual date of submission of return
Under Details for Income and tax calculation, enter the required details of:
Income under the head Salaries
Income under the head House Property
Income under the head Capital Gains
Income under the head Business or Profession
Income under the head Other Sources
Under Deduction Details, enter the relevant deductions applicable to you, including but not limited to PPF, LIC, Housing Loan, NPS, Mediclaim, and Loan on Higher Education.
Under Taxable Income, enter or edit the TDS/TCS details where you have substantiating evidence available.
The total tax and interest payable by you will be displayed at the end of the page.
You don't have to rush to file your income tax return. Knowing your sources of income and preparing your paperwork in advance of the ITR filing season will help you ensure a seamless filing process. You may make more informed decisions about the old and new tax systems, plan more effectively, and prevent surprises by using tools like the income tax calculator.
For all personal finance updates, visit here