Know How You Can Calculate Your Liability with Tax Calculator
This article explains the features and working of the tax calculators in India. They are very helpful in computing the net taxability for a financial year and provide assistance in reducing the same as well. Read the content to know how.
Understanding and calculating the tax liability in India is the most complicated thing which can make the annual tax return filing a real headache for all. There are several professionals who are working to help one in finding one’s net taxability. You too must be paying a huge sum of money in the form of fees to those professionals. But, do you know you can calculate the same on your own? The tax calculator in India which is available online can be used to compute the net tax liability for the financial year. Let’s understand how!
Features of Tax Calculator
There are various tax planning tools available on different portals which are focused on providing the best solutions for computing the tax liability. Here are some of its prime characteristics:
How Does Online Tax Calculator Work?
India has a typical tax system due to which it becomes quite difficult sometimes to compute the return liability. The tax planning calculator is quite helpful in this context and provides assistance to the users to compute their net liability. Let’s elaborate how does this tool work.
Adds All the Income Earned in the Previous Year
Deduct the Allowed Expenses to Fetch Net Income
There are various expenses which are genuinely paid by the assessee in the previous year and allowed by the income tax department. After deducting such expenses, the net taxable income is computed.
Calculate Total Deductions for the Year
Reduce the Net Income By Allowed Deductions
Compute the Tax Liability
The tax calculator is designed keeping all the above points in mind. It generates the exact taxable amount as well as the taxes payable to help the investors file tax return easily. Furthermore, there are some tax planning tools which help in reducing the liability as well by recommending the best tax-saving plans. So, it is the best way to generate the total taxability in a financial year.
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ABOUT THE AUTHOR
The author is a writer who works with MySIPonline and writes informative articles and blog posts for the investors across the country. She has expertise in the field of finance and has helped many investors in gaining exact knowledge about the investments and tax planning in India.