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Income Tax Calculator

Income

HRA Exemptions

Deductions

As per old tax regime, max deduction allowed is ₹1,50,000.
As per new tax regime, the maximum deduction allowed is restricted to 14% of salary for central government employees and 10% for any other employee.

Tax Old Scheme

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Tax new scheme

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Tip For You

Increasing Investment percentage annually helps to achieve targets faster. 10% is suggested.

Introduction

Paying tax is inevitable, be it for an individual or a business. Tax is levied on the income earned by an individual or business after certain deductions. Due to multiple income tax slab rates combined with many tax exemptions and deductions, calculation of income tax can be a challenging task. Not with the presence of an easy-to-use online income tax calculator, though!

What is the income tax calculator?

Fisdom’s online income tax calculator is an easy-to-use tool and is available free of cost. It can be used by anyone looking to calculate their tax liability as per latest tax laws applicable in the ongoing financial year.

How to use Fisdom’s income tax calculator?

Fisdom’s online income tax calculator helps one to easily determine the tax outflow for the latest financial year, as per the old and the new tax regime. The calculator requires users to input certain data on income, investments, and expenses to estimate the taxes payable.

Here is the step-by-step process to use Fisdom’s income tax calculator:

  1. From the drop-down under the ‘Assessment Year’ section, select the assessment year for which you wish to calculate income tax.
  2. Select the ‘Age Category’ from:
    1. Below 60
    2. 60 or above
    3. 80 or above

    This will determine your income tax rate, hence it is important to select the right option.

  3. Under the ‘Income’ category:
    1. Enter gross salary (annual excluding any deductions)
    2. Enter annual income from other sources (if applicable)
    3. Annual income from interest
    4. Annual income from let-out property (if any)
    5. Annual interest paid on a home loan for self-occupied property
    6. Annual interest paid on home loan (while living in rented property)
  4. Under the HRA exemptions, mention:
    1. Basic salary received – annual
    2. Monthly dearness allowance (if it forms part of your income)
    3. HRA / house rent allowance received – annual
    4. Total rent paid – annual
    5. Also, select ‘YES/NO’ depending on whether you reside in a metro city or non-metro city
  5. Under the Deductions section, you will see a note stating the maximum deduction as per old and new tax regime. Here,
    1. Enter Basic deduction as per Section 80C
    2. Contribution to NPS/ National Pension Scheme – if any,
    3. Medical Insurance premium – if applicable
    4. Donation to Charity – if made during the financial year
    5. Interest on education loan – if applicable
    6. Interest on deposits in savings account

Income tax rates as per tax slabs – FY 2021-22

Budget 2021 saw no changes announced in income tax slabs and tax rates. Therefore, the tax slabs and rates continue to be the same as in FY 2020-21.

The total income after deductions and exemptions is subject to tax as per the income tax slabs. Individuals, HUFs, and NRI (whose income is generated in India) taxpayers can avail a basic exemption limit, which means income upto a certain specified limit is not taxable. The basic exemption limit varies across taxpayers depending on his/her age. Income tax slabs and rates are the same for men and women taxpayers.

Income Tax slabs and rates for taxpayers within 60 years of age:

Annual Income New Tax Regime
Up to Rs. 2.5 lakhs Exempt
Rs. 2.5 lakhs – Rs.5 lakhs 5%
Rs. 5 lakhs – Rs. 7.5 lakhs 10%
Rs. 7.5 lakhs – Rs. 10 lakhss 15%
Rs. 10 lakhs – Rs. 12.5 lakhs 20%
Rs. 12.5 lakhs – Rs.15 lakhs 25%
Above Rs. 15 lakhs 30%

Income Tax slabs and rates for taxpayers above 60 years or senior citizens

The below tax rates are applicable for a resident individual who is 60 years or above at any time during the previous financial year, but less than 80 years on the last day of the previous year

Annual Income Tax Rate
Up to Rs. 3 lakhs Exempt
Rs. 3 lakhs – Rs. 5 lakhs 5%
Rs. 5 lakhs – Rs. 10 lakhs 20%
Above Rs. 10 lakhs 30%

Income Tax slabs and rates for taxpayers above 80 years of age or super senior citizens

Taxpayers who are above 80 years of age are called super senior citizens and will be required to pay taxes as per the income tax slab FY 2020-21 & AY 2021-22 (old tax regime) as mentioned below:

Annual Income Old Tax Regime
Up to Rs. 5 lakhs Exempt
Rs. 5 lakhs – Rs. 10 lakhs 20%
Above Rs. 10 lakhs 30%

Income tax rebate

If a taxpayer’s total income during the assessed financial year is under Rs. 5 lakhs, rebate under section 87A is applicable up to Rs. 12,500.

Surcharge and cess

If a taxpayer’s net income is above Rs. 50 lakhs but below Rs. 1 crore, a Surcharge of 10% is levied on the income tax amount. The below table shows how surcharge is applied:

Total Income Surcharge % on Income-tax
Rs. 50 lakhs to 1 crore 10%
Rs. 1 to 2 crores 15%
Rs. 2 to 5 crores 25%
Above Rs. 5 crores 37%

Apart from this, the Health and Education cess at 4% is levied on the income tax plus surcharge (if applicable) amount.

Exemptions on income tax allowed under the new tax regime

Mentioned below are the permitted exemptions on total income tax payable. Each of these exemptions is applicable subject to certain conditions and limits being satisfied:

  1. House rent allowance
  2. Leave travel allowance
  3. Gratuity
  4. Agricultural income
  5. Per-diem
  6. PF and PPF withdrawals
  7. NPS withdrawal
  8. Leave encashment

Who should file ITR and how can one submit an income tax return?

A taxpayer:

  1. Whose total income is above the basic exemption limit or
  2. Who satisfies other conditions (like holding foreign assets)Must file Income Tax Returns (ITR).

The format of ITR is specified by the tax authorities

Failure to file ITR within the specified due date can result in:

  1. interest
  2. penalty
  3. prosecution

ITR can be filed electronically and the ITR V can be obtained upon filing the ITR. The ITR form will vary depending on one’s sources of income, income bracket, and foreign assets. One need not send the ITR V copy to the Centralized Processing Centre, if it is authorized through Aadhaar or digital signature (DSC). If not authorized, the ITR V copy must be physically sent to CPC in Bangalore. The timeline for the same is 120 days from filing the ITR.

FAQs

Is everyone required to file income tax returns?
If an individual’s income is under the basic exemption limit, he/she need not file income tax returns. If an individual’s income is below Rs 2.5 lakhs and he/she wants to claim an income tax refund, it is important to file an ITR.
Does the online income tax calculator help in estimating TDS?
No, the online income tax calculator cannot compute the Tax Deducted at Source (TDS). It is mainly meant for calculating tax liability for the assessment year.
Is income tax calculated on gross income?
Income tax is estimated on the ‘total income’ as against gross total income as per the income tax act. Gross total income less deductions gives the total income. The tax is calculated and payable on the net income.
Can we change the tax regime while calculating income tax every year?
Yes, a taxpayer can change the regime in each assessment year between old and new regimes. However, the taxpayers who have business income cannot use this option. Salaried individuals and pensioners are eligible to switch between tax regimes every year as per their convenience as long as they don’t have business income.
Is 80C exemption not applicable any more?
The Section 80C deduction is not removed, however, it has been restricted for taxpayers who opt for the new tax regime. If a taxpayer chooses the new tax regime, deduction claims under section 80C are not allowed.