What is an Income Tax Calculator?

An Income Tax Calculator is an online tool that helps you to calculate the total tax payable based on your taxable income, expenses, age, investments and interest paid towards your home loan as per the latest announcement on union budget 2023-24.

Depending on the tax regime, the tax slabs and factors considered will vary. You can calculate income tax for financial year 2024 and FY 2025 both using our income tax calculator that is free, easy-to-use, and generates error-free results instantly. Below are the steps to use the income tax calculator for the current financial year 2023-24.

How to use an income tax calculator for FY 2023-24 & AY 2024-25?

The government calculates your income tax on the taxable income based on the tax slab applicable. Your taxable income is derived by adding income from all sources (salary, rent, capital gains, etc.) to get your gross total income and subtracting from this the deductions and exemptions you are eligible for. If you receive HRA and live on rent, you can claim exemption on HRA.

Steps to calculate income tax for FY 2023-24

You can use our income tax calculator based on your salary or income received by other sources.

  1. Select your age bracket
  2. Enter your annual income
  3. Disclose investments and eligible deductions
  4. Enter HRA, LTA exemptions
  5. You can enter ‘0’ for fields that are not applicable. Once you go through the steps, you will see your tax payable under the old and new regimes for FY 2023-24.

Deductions under different sections

  • 80C (ELSS funds, PPF, house loan principal repayment, etc.): Section 80C of the Income Tax Act provides various investment options that are eligible for tax deductions up to a maximum limit of Rs. 1.5 Lakh. Additionally, taxpayers can claim a deduction on the principal amount of their home loan under this section.
  • 80CCD(1B) (National Pension System): Section 80CCD(1B) of the ITA allows taxpayers to claim a deduction of up to Rs. 50,000 for contributions made towards the National Pension System (NPS). This is in addition to the limit of Rs. 1.5 Lakh under Section 80C. This deduction is available for both salaried and self-employed individuals.
  • 24B (Home loan interest repayment): Section 24B of the Income Tax Act allows you to claim a deduction on the interest paid on your home loan. The deduction is available up to a maximum of Rs. 2 Lakh per financial year for a self-occupied property and can help reduce your taxable income and save money on taxes.
  • 80E (Education loan interest repayment): Section 80E of the Income Tax Act lets taxpayers claim a deduction on the interest paid on their education loan. The deduction is available for a maximum of 8 years and can help taxpayers reduce their taxable income.
  • 80G (donations to charitable institutions): Section 80G of the Income Tax Act allows taxpayers to claim a deduction on the donations made to registered charitable institutions. The deduction is available up to a maximum of 50% or 100% of the donation amount, depending on the type of institution.

​Income tax calculation example based on new vs old tax regime

For instance, Samaira, a 30-year-old employee in an MNC in Mumbai, earns Rs. 12,50,000 per annum. With a standard deduction of Rs. 50,000, her gross total income becomes Rs. 12,00,000. She also receives an HRA of Rs. 50,000, a Special Allowance of Rs. 20,000 per month, and an LTA of Rs. 20,000 annually. Samaira pays a monthly rent of Rs. 40,000 in Mumbai.

Her tax calculations for both regimes are shown below.
 

Nature

Amount

Exemption/ Deduction

Taxable Income (Old Regime)

Taxable Income (New Regime)

Basic Salary

12,50,000

-

12,50,000

12,50,000

HRA

6,00,000

3,55,000

2,45,000

6,00,000

Special Allowance

2,40,000

-

2,40,000

2,40,000

LTA

20,000

12,000 (bills submitted)

8,000

20,000

Standard Deduction

-

50,000

50,000

50,000

Gross Total Income from Salary

-

-

16,93,000

20,60,000


​Income tax calculation example based on old tax regime

Samaira gets Rs. 10,000 as interest from her savings account and Rs. 15,000 through interest on her FD annually. She has also made several investments by parking money in tax-saving instruments. Additionally, she pays an LIC premium of Rs. 8,000, and has taken medical insurance and pays a premium of Rs. 10,000.
  • As per Section 80C of the Income Tax Act, Samaira claimed a maximum deduction of Rs. 1,50,000 for PPF deposit, ELSS investment, LIC premium, and EPF deduction.
  • She also claimed Rs. 10,000 as a deduction u/s 80D for her medical insurance premium.
  • Samaira claimed Rs. 10,000, which is her savings account interest, under Section 80TTA.
As per the old regime, this is her gross taxable income and her total tax liability.
 

Nature

Amount (Rs.)

Total (Rs.)

Income from Salary

16,93,000

-

Income from Other Sources

25,000 (Savings + FD)

-

Gross Total Income

-

17,18,000

Deductions

-

-

80C

1,50,000

-

80D

10,000

-

80TTA

10,000

1,70,000

Gross Taxable Income

-

15,48,000

Total Tax (Including Cess)

-

2,84,795


Income tax calculation example based on new tax regime

As per the new regime, this is Samaira’s gross taxable income and total tax liability.
 

Nature

Amount (Rs.)

Total (Rs.)

Income from Salary

20,60,000

-

Income from Other Sources

25,000 (Savings + FD)

-

Gross Total Income

-

20,85,000

Total Tax (Including Cess)

-

3,38,500


As of FY 2023-24, there are two tax regimes in India – old and new. As a taxpayer, you can choose any one regime for a financial year after discussing with an expert. In case you want to change your regime, you can opt for it during the next financial year again.

Income tax slabs (2023-24)

It is always best to know in advance what is the tax payable amount based on your income and investments. The income tax calculator helps calculate your taxable income and also the tax payable as per the income tax slabs rate applicable.

New income tax slabs for FY 2023-24 (AY 2024-25)

Taxable income

New Tax Regime Rate

Up to Rs. 3,00,000

NIL

Rs. 3,00,000 – Rs. 6,00,000

5% on income, which exceeds Rs. 3,00,000

Rs. 6,00,000 – Rs. 9,00,000

Rs. 15,000 + 10% on income, which exceeds Rs. 6,00,000

Rs. 9,00,000 – Rs. 12,00,000

Rs. 45,000 + 15% on income, which exceeds Rs. 9,00,000

Rs. 12,00,000 – Rs. 15,00,000

Rs. 90,000 + 20% on income, which exceeds Rs. 12,00,000

Above Rs. 15,00,000

Rs. 1,50,000 + 30% on income, which exceeds Rs. 15,00,000


New income tax slabs for FY 2023-24 (AY 2024-25)

New income tax slabs for individuals between 60 and 80 years (senior citizens)

Taxable income

New Tax Regime Rate

Up to Rs. 3,00,000

NIL

Rs. 3,00,000 – Rs. 5,00,000

5%

Rs. 5,00,000 – Rs. 10,00,000

20%

Above Rs. 10,00,000

30%


New income tax slabs for aged 80 and above (super-senior citizens)

Taxable income

New Tax Regime Rate

Up to Rs. 5,00,000

NIL

Rs. 5,00,000 – Rs. 10,00,000

20%

Above Rs. 10,00,000

30%


Old income tax slabs for FY 2023-24 (AY 2024-25)

Old income tax slabs for individuals below 60 years

Taxable income

Old Tax Regime Rate

Up to Rs. 2,50,000

NIL

Rs. 2,50,001 – Rs. 5,00,000

5%

Rs. 5,00,001 – Rs. 10,00,000

20%

Above Rs. 10,00,000

30%

What are the benefits of filing income tax online?

Filing income tax returns online:

  • Is quick and convenient
  • Allows for faster and electronic tax refunds
  • Facilitates a prompt confirmation receipt and real-time status updates
  • Is confidential and secure
  • Is error-free and saves professional costs
  • Helps with VISA processing, getting insurance, and loan applications
  • Serves as an income and address proof
  • Makes it easy to avoid the late penalty
  • Helps you carry forward losses

Does everyone have to file income tax?

You must file income tax returns if your gross total income for the financial year exceeds the basic exemption limit. For the old regime, the basic exemption limit is:

  • Rs. 2.5 lakh for residents below age 60
  • Rs. 3 lakh for senior citizens (between 60 and 80 years)
  • Rs. 5 lakh for super-senior citizens (80 years and above)

In the new tax regime, the basic exemption is Rs. 2.5 lakh across all age categories.

Additionally, you must file ITR if you have:

  • Deposited more than Rs. 1 crore in current account(s)
  • Spent more than Rs. 2 lakh on foreign travel
  • Incurred more than Rs. 1 lakh on electricity
  • Income in/ assets from/ signing authority in an account in a foreign country
  • Gross total income more than the exemption limit before claiming relevant capital gains exemptions

As per Union Budget 2021, senior citizens above age 75 are exempt from filing ITR for FY 2021-22 if they have only pension and interest income and the two are deposited/ earned in the same bank.

What are the eligibility criteria to file income tax?

Any resident citizen with gross total income above the basic exemption limit must file income tax returns. However, if your total income is less than the taxable limit, you can file a NIL return.

Other entities that file ITR in India are:

  • Hindu Undivided Family (HUF)
  • Associations of Persons (AoPs)
  • Local authorities
  • Corporate firms
  • Charitable/ religious trusts
  • Companies
  • Artificial juridical persons
  • Body of Individuals (BOI)

Depending on the taxpayer, the correct ITR form must be used.

What are the details required for e-filing an income tax return?

For e-filing of income tax return keep the following details and documents ready:

  • PAN, Aadhaar, permanent address
  • Bank account details relevant to the financial year (indicate which account any income tax refund should go to)
  • Form 16 and proofs of interest income, for instance, from FDs
  • Deduction details, pertaining to Section 80C, 80D, and others under Chapter VI-A
  • Proof of tax paid (advance tax, TDS, etc.)

What are the income tax saving options available for salaried individuals?

  • Standard deduction
  • House Rent Allowance (partial or total)
  • Leave Travel Allowance (for domestic travel)
  • Work-related expenses (telephone bills, meal coupons, etc.)
  • Deductions under Section
  • 80C, 80CCC, 80CCD(1) (NPS, PPF, ELSS, tuition fees, tax-saver FD)
  • 80D (health insurance premiums)
  • 80C, 24B, and 80EE/ 80EEA (home loan repayment)
  • 80E (education loan interest)
  • 80G (contributions to approved charitable organisations)
  • 80TTA (savings account interest)
  • Other deductions

These exemptions/ deductions apply to the old regime. The new tax regime offers very few allowances and deductions for taxpayers.

Disclaimer

The data generated herein is completely and solely based on the information/ details provided by you in response to the questions specified by Bajaj Finserv Limited. These questions and the calculations thereon resulting in specific data are developed and based on certain tools and calculators that are made available to Bajaj Finserv Limited and are based on predetermined presumptions/ assumptions. Such information and the resultant data are provided only for user's convenience and information purposes.

Frequently asked questions

How much income tax should I pay on my salary?

The income tax payable depends on your taxable income and the income tax slab that you fall under. Your taxable income is what you get when you subtract the exemptions and deductions from your gross total income. This includes your salary (less HRA, standard deduction, etc., for the old regime) and income from other sources.

The tax slab depends on your taxable income and age and is different for the old and new regimes.

How to calculate total income tax online?

The income tax calculator is a simple online tool that makes your life easy when it comes to tax calculations. You simply have to enter the relevant details in the empty fields:

  • Select gender
  • Enter your annual income
  • Enter the interest paid Home loan
  • Enter the principal repaid on the home loan

You can view the total income tax benefit to the right of the calculator along with your tax payable before and after taking a home loan.

What is the limit of 80C deduction?

Under Section 80C, you can claim deductions of up to Rs. 1.5 lakh per financial year. However, there is an additional deduction of up to Rs. 50,000 permitted for deposits made to an NPS account under section 80CCD (1B).

The Section 80C deduction applies to payments made towards EPF, PPF, ELSS, tax saving FD, LIC premiums, home loan principal repayment, and more. The limit of Rs. 1.5 lakh is inclusive of subsections like 80CCC, 80CCD(1), and 80CCD(2).

How much tax rebate can I avail on a home loan?

When repaying a home loan, you can claim:

  • Up to Rs. 1.5 lakh per year under Section 80C for principal repayment and stamp duty
  • Up to Rs. 2 lakh per year under Section 24B for interest repayment
  • Up to Rs. 50,000 annually as an additional interest deduction under Section 80EE for first-time homeowners
  • Up to Rs. 1.5 lakh annually as an additional interest deduction, on home loans taken for affordable housing, under Section 80 EEA

You can benefit from either Section 80EE or 80EEA. Hence, the maximum deduction you can claim per year is Rs. 5 lakh (Rs. 1.5 lakh + Rs. 2 lakh + Rs. 1.5 lakh). In case of a joint home loan taken by co-owners, each one can claim tax deductions individually, as per their ownership stake.

What is the maximum limit for tax deduction under section 24?

The maximum tax deduction under section 24 is Rs. 2 lakh per financial year. This deduction is for home loan interest repayment. If you fail to purchase a home within 5 years of taking the loan, the maximum deduction limit drops to Rs. 30,000.

What is the maximum non-taxable income for salaried individuals?

Under the old regime, individuals with taxable income up to Rs. 2.5 lakh are exempt from paying income tax. This exemption limit extends to Rs. 3 lakh for senior citizens and Rs. 5 lakh for super senior citizens. Under the new regime, individuals from all age groups are exempt from paying income tax if their taxable income is up to Rs. 2.5 lakh.

If your taxable income is less than Rs. 5 lakh, you can claim up to Rs. 12,500 under Section 87A under both regimes.

What is an income tax certificate & its importance?

The Income Tax Return - Verification form (ITR-V) is the income tax certificate that you get when you file your ITR online without a digital signature. ITR is important to the IT Department in verifying the authenticity of your e-filing.

You can download a PDF version of ITR-V from the official IT Department website. Once you print and sign the form, you must then send it to CPC Bangalore within 120 days of filing your returns online.

How does income tax affect your credit score?

Income tax has no direct effect on your credit score. If you file your ITR, your credit score will not increase. However, your ITR-V is an important document that can help you get a loan. Once you get a loan, you can make diligent repayment to improve your credit score. Hence, income tax does affect your credit score indirectly.

How to get tax exemption of income up to Rs. 7 Lakh as per the new tax regime?

According to the Union Budget for 2023-24, taxpayers earning up to Rs. 7 Lakh per annum do not have to pay any taxes, as they are entitled to a full rebate under the new regime. You must opt for the new tax regime while filing your income tax returns (ITR) to claim the tax exemption.

What is the maximum non-taxable income limit?

Under the new tax regime, the basic exemption limit has been increased to Rs. 3 Lakh and Rs. 2.5 Lakh under the old regime.

What is the professional tax in India?

Professional tax is a state-level tax in India for individuals earning through professions, trades, or employment. Each state has its rates and rules. It's mandatory for both salaried and self-employed professionals to pay. Employers deduct it from salaries and remit it to the state government. Exemptions exist for specific groups. Non-compliance can lead to penalties. Revenue is used for public services and welfare. Stay informed about your state's regulations to comply and avoid penalties. Visit the official tax department website or consult a tax professional for details.

What is gross income and how to calculate it?

Gross income refers to the total earnings an individual receives from all sources before any deductions or taxes are applied. It includes all forms of income, such as wages or salary, bonuses, rental income, interest income, dividends, business income, and any other sources of earnings.

To calculate gross income, follow these steps:

  1. Determine all sources of income: List down all the different sources of income you have received during the specific period for which you want to calculate your gross income. This may include your salary, bonuses, rental income, interest earned from bank accounts, dividends from investments, etc.
  2. Add up the income from each source: Add up the income from each source to get the total earnings before any deductions or taxes.

How to save tax for a salary of Rs. 20 lakh?

Saving taxes on a salary of Rs. 20 lakh can be achieved through various tax-saving investments and deductions available under the Indian Income Tax Act. Here are some effective ways to save tax:

1. Use Section 80C: Invest in tax-saving instruments like PPF, EPF, ELSS, NSC, etc., up to Rs. 1.5 lakh to reduce taxable income.

2. Opt for NPS: Get an additional deduction of up to Rs. 50,000 under Section 80CCD(1B) for NPS contributions.

3. Medical insurance premiums: Deduct premiums up to Rs. 25,000 for yourself, family, and Rs. 50,000 for senior citizen parents under Section 80D.

4. Home loan interest: Claim up to Rs. 2 lakh deduction on interest paid for a self-occupied property under Section 24(b).

5. Standard deduction: Enjoy a standard deduction of Rs. 50,000 as a salaried individual.

6. Tax-saver fixed deposits: Invest in 5-year tax-saving fixed deposits for Section 80C benefits.

7. Donations: Get deductions for donations to eligible charitable organizations under Section 80G.

8. House Rent Allowance (HRA): If you rent a house and receive HRA, claim deductions with conditions.

9. Education loan interest: Deduct interest on education loans under Section 80E.

10. Preventive health check-up: Claim up to Rs. 5,000 for health check-ups under Section 80D.

How to save tax for salary above Rs. 30 lakh?

Saving taxes on a salary above Rs. 30 lakh can be achieved by utilizing various tax-saving strategies and investments. Here are some effective ways to save tax:

  1. Invest in Section 80C options
  2. Contribute to NPS (National Pension System
  3. Choose a health insurance
  4. If you have a home loan, claim deductions on the interest paid under Section 24(b)
  5. As a salaried individual, avail the standard deduction of Rs. 50,000 from your salary income
  6. Invest in tax-saving fixed deposits
  7. Utilise deductions under Section 80E
  8. If you live in a rented house and receive HRA as part of your salary, claim deductions with conditions
  9. If you have capital gains from the sale of assets, explore options like investing in tax-saving bonds under Section 54EC or reinvesting in a new residential property under Section 54

Which income is not taxable in India?

In India, certain incomes are not taxable, including:

  1. Agricultural Income
  2. Interest on Tax-Free Bonds
  3. Dividends from Indian companies
  4. Long-Term Capital Gains on Equities (up to Rs. 1 lakh)
  5. Gifts from specified relatives or on specific occasions
  6. Leave Travel Allowance (LTA)
  7. Gratuity (up to a specified limit)
  8. EPF/PPF Withdrawals (after specific periods)
  9. Life Insurance Proceeds
  10. Scholarships and Awards for education expenses.

Note: Exemption limits and conditions may vary; check the latest tax laws for compliance.

How to calculate income tax of a salaried employee?

To calculate income tax for a salaried employee in India:

  1. Determine gross income
  2. Deduct Section 80C investments (up to Rs. 1.5 lakh) and other deductions
  3. Arrive at taxable income
  4. Apply the applicable tax slab (5%, 20%, or 30%)
  5. Add 4% health and education cess
  6. Subtract rebates and TDS
  7. The result is the final tax payable or refundable
Is it mandatory to file income tax returns?

 In India, it is mandatory to file Income Tax Returns (ITR) for individuals with income exceeding the basic exemption limit (Rs. 2.5 lakh for individuals below 60 years). Other cases include foreign assets/income, losses to carry forward, presumptive income, DTAA claims, tax refund claims, and for companies and firms. Voluntary filing is also beneficial for claiming deductions and maintaining financial records.

What are the new Income Tax Rules?

The new tax regime has been modified to make it more appealing with the following changes:

  1. The new tax regime is now the default option. Unless an individual specifically chooses the old tax regime, their income will be taxed according to the new tax slabs and rates.
  2. The rebate under Section 87A has been increased from a taxable income of Rs. 5 lakh to Rs. 7 lakh. This means individuals opting for the new tax regime with taxable income up to Rs. 7 lakh will pay no taxes.
  3. The basic exemption limit in the new tax regime has been raised to Rs. 3 lakh from Rs. 2.5 lakh.
  4. The number of income tax slabs in the new tax regime has been reduced from six to five.
  5. A standard deduction of Rs. 50,000 has been introduced for salaried and pensioners under the new tax regime.
  6. Family pensioners can now claim a standard deduction of Rs. 15,000 under the new tax regime.
  7. The highest surcharge rate of 37% has been reduced to 25% in the new tax regime.

 

When and how many times can you file your income tax returns?

Individuals can file their income tax returns (ITR) annually. The deadline for filing ITR is usually July 31st of the assessment year.

Which deductions are not available under the new tax regime?

Under the new tax regime in India (Section 115BAC), introduced with reduced income tax rates, certain deductions and exemptions available in the old regime are not applicable. Key exclusions include the standard deduction for salaried individuals, HRA, professional tax deduction, transport allowance, deductions under Chapter VI-A (except for specific sections), LTA, home loan interest deduction (Section 24), and deductions for certain professions.

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