Income Tax Calculator FY 2023-24
The Union Budget has left individuals confused with the choice of the tax regime. Both old and new tax regimes require a proper assessment before choosing one. With the help of the new income tax calculator FY 2023-24, you can gauge the impact of both the tax structures on your income. This calculator will help you estimate your taxes on your income.
As per budget 2023
- Income tax exemption limit increased from Rs 2.5 lakh to Rs 3 lakh
- Tax Rebate under section 87A increased from Rs 5 lakh to Rs 7 lakh
- The default tax regime will be the new income tax regime and the taxpayers can choose to opt for the old income tax regime.
- Check latest Income Tax Slabs FY 2023-24
What is an Income Tax Calculator?
An income tax calculator is a tool that will help calculate taxes one is liable to pay under the old and new tax regimes. The calculator uses necessary basic information like annual salary, rent paid, tuition fees, interest on child’s education loan, and any other savings to calculate the tax liability of an individual.
It gives the total tax payable under the old and new scheme. Also, it suggests investment opportunities for the individual based on the tax liability. The online income tax calculator is a convenient tool and is free to use. It is simple to understand and can be used by anyone to calculate their tax liability.
How To Use an Income Tax Calculator for FY 2023-24 (AY 2023-24)?
Scripbox’s Income tax calculator helps anyone in determining their tax outflow for the financial year. The online tax calculator requires some data concerning income, investments, and expenses of the taxpayer to calculate taxes online.
Let us now see the step-by-step process of how one can make use of the Scripbox’s Income Tax calculator online.
- Step 1: Enter Annual Income – Provide the details of the income earned under various heads of income such as salary, interest income from deposits, capital gain, rent from house property, and other taxable income
- Step 2: Enter Exemptions – Provide the details of exemptions available against the income earned during the financial year. Such exemption can be against salary, self-occupied property, and let-out property.
- Step 3: Tax Deductions – Provide the details of deduction available under section 80C investments and expenses, health insurance, NPS, education loan, and donations.
- Step 4: Basic Details – Provide your age and taxes paid during the financial year. Your age will help in determining the tax payable.
- Step 4: Tax Breakdown – In this step, the calculator calculates the total tax as per the new scheme as well as per the old scheme. Also, it determines how much more needs to be invested for effective tax saving. Furthermore, taxpayers can go back at any step and change the values as required. Additionally, the calculator suggests the best investment options to save tax further.
How To Calculate Income Tax for FY 2023-24?
The Income Tax calculation is on the basis of the income tax slab applicable to the taxpayer, and the net income. You can follow the following steps to calculate the income tax for any financial year 2023-24:
Step-1: Calculate the Gross Total Income
You must calculate the gross total income under the following different heads of income.
- Income From Salary- Add the total gross salary received from the employer during the financial year. In your Form 16 your gross salary will be mentioned. Your employer will issue a Form 16 after the end of the financial year
- Income From Capital Gain– Add the long term and short term capital gains to your gross income. Not all capital gains are taxable at a slab rate. Hence, you must be careful about the rate of tax applicable.
- Income From House Property– Add your net rental income for a let-out property to your gross income. Make sure you claim the deduction for municipal taxes paid, standard deduction, interest on repayment of home loan etc.
- Income From Business or Profession: Add your income earned by running a business or pursuing a profession. Make sure you claim the expenses related to such business or profession while calculating the income under this head.
- Income From Other Sources: Add the income earned from any other sources. Income such as interest income on fixed deposit, savings bank interest, etc fall under income from other sources.
Step- 2: Claim the Exemptions and Tax Deductions
From the gross income now deduct all the exemptions, allowances, and deductions available to you w.r.t. the income earned.
- Salary Income Exemptions, Allowances and Deductions
- Leave travel concession as contained in clause (5) of section 10;
- House rent allowance as contained in clause (13A) of section 10;
- Some of the allowance as contained in clause (14) of section 10;
- standard deduction, the deduction for entertainment allowance and employment/ professional tax as contained in section 16;
- Rental Income from House Property Deductions
- Interest paid on home loan under section 24. Deduction against interest on home is applicable in respect of self-occupied or vacant property.
- Loss under the head income from house property for the rented house shall not be allowed to be set off under any other head and would be allowed to be carried forward as per existing law
- Deduction From Business or Profession Income
- Expense incurred in relation to running such business or profession
- Depreciation on assets, and additional depreciation on such assets.
- Deduction for donation for or expenditure on scientific research
- Rent, Rates, Taxes, Repairs, and Insurance of building
- Any bonus or commission paid to the employees
- A contribution made to the employees recognized provident fund or approved superannuation fund or approved gratuity fund.
- Deductions From Gross Income
- Section 80C deduction against Public Provident Fund (PPF), Employees’ Provident Fund(EPF), the premium paid towards life insurance policies, principal repayment of a home loan. Section 80C includes investment in National Savings Certificate(NSC), investment in Equity Linked Savings Scheme (ELSS mutual fund), children tuition expenses, etc
- Contribution to National Pension Scheme (NPS)
- Medical insurance policies for self, spouse & dependent children.
- Repayment of education loan
- Contribution for a charitable purpose
Step-3: Calculate The Net taxable Income
Deduct the exemptions, allowances, and deduction from the gross income. This will be your net taxable income for the financial year. You need to calculate the tax payable on such net taxable income.
Step-4: Calculate the Tax Payable
Calculate the tax payable for the financial year at the applicable income tax slab rate for FY 2023-24. Calculate the taxes already paid during the financial year such as TDS, advance tax, self assessment tax. Deduct the taxes already paid from the total tax payable, this will be your net tax payable for the financial year.
Income Tax Rates for New and Old Regime FY 2023-24
|Old Tax Slabs||Old Income Tax Rates||New Tax Slabs||New Income Tax Rates|
|Upto Rs 2.5 lakh||NIL||Upto Rs 3 lakh||NIL|
|Rs 2.5 – Rs 5 lakh||5%||Rs 3 lakh – Rs 6 lakh||5%|
|Rs 5 – Rs 10 lakh||20%||Rs 6 lakh – Rs 9 lakh||10%|
|Above Rs 10 lakh||30%||Rs 9 lakh – Rs 12 lakh||15%|
|Rs 12 lakh – Rs 15 lakh||20%|
|Above Rs 15 lakh||30%|
Income Tax Rates for New and Old Regime AY 2022-23
|Income range per annum||Tax Rate as per Old Regime||Tax Rate as per New Regime|
|Upto Rs 2.50 Lakh||No Tax||No tax|
|Rs 2.50 Lakh – Rs 5 Lakh||5%||5%|
|Rs 5 Lakh – Rs 7.50 Lakh||20%||10%|
|Rs 7.50 Lakh – Rs 10 Lakh||20%||15%|
|Rs 10 Lakh – Rs 12.50 Lakh||30%||20%|
|Rs 12,50,000 – Rs 15,00,000||30%||25%|
|Above Rs 15,00,000||30%||30%|
Frequently Asked Questions on Tax Calculation
Does the income tax calculator calculate the TDS on salary?
No, the income tax calculator doesn’t calculate TDS. The employer deducts TDS. On the Gross Salary, the employer deducts any applicable TDS. Therefore, the income tax calculator only calculates the tax liability for the assessment year.
You can compute the tax payable by applying the income tax slab rate of the net taxable income. Firstly, calculate the gross income under all the 5 heads of income i.e. salary, house property, capital gains, business or profession, and other sources. Secondly, calculate the total deductions available. Now, deduct the deductions from the gross income, this will be your net taxable income. Now apply the income tax slab rate to the net taxable income and calculate the total tax payable. Calculate the total taxes paid during the financial year in the form of TDS, advance tax, self assessment tax. Now deduct taxes paid from the tax payable, this will be the net tax payable for the financial year.
To calculate the tax percentage you need to calculate total tax payable and the total net taxable income. The formula for calculating tax percentage is total tax payable divided by the total net taxable income for the financial year. For example- for the financial year 2023-24 the net taxable income is Rs 12,00,000 and the total tax payable is Rs 1,19,000. The tax percentage is total tax payable/ net taxable income i.e. Rs 1,79,000/ Rs 12,00,000 i.e. 14.92%.
An income up to Rs 3 lakhs is tax exempt for a resident taxpayer for the financial year as per the new tax regime. For senior citizens and super senior citizens the exempt income is Rs 2.5 lakhs and for super senior citizen taxpayers the tax free income is Rs 5 lakhs for the financial year under old tax regime. However, the basic exemption limit for senior citizens and a super senior citizen under the new tax regime is Rs 2.5 lakhs.
You need to pay tax if the total income exceeds the basic exemption limit. The basic exemption is different for different types of taxpayers i.e. an individual, senior citizen, and a super senior citizen. This exemption limit also differs for the old regime and new regime.
Old Tax Regime – The basic exemption limit is Rs 2.5 lakhs for an individual, Rs 3 lakh for a senior citizen and Rs 5 lakhs for a super senior citizen.
New Tax Regime – The basic exemption limit is Rs 3 lakhs for an individual, Rs 2.5 lakhs for a senior citizen and a super senior citizen.
It is mandatory for everyone to file an income tax return. However, a taxpayer whose net taxable income is less than the minimum tax slab, i.e., INR 2.5 lakh is exempted from mandatory tax filing as per old regime.
It is mandatory for a taxpayer who wants to claim tax refunds of TDS deducted to file income tax returns. Even though tax filing isn’t mandatory for some individuals, it has some benefits.
Claim Tax refunds: For any TDS that has been deducted can be claimed only by tax filing.
Applying for a loan: While applying for a loan, the eligibility and the loan amount sanction depends on the assessee income. The tax filing documents are processed for this.
Carry forward of Losses: The taxpayer can always carry forward the losses to set them off against capital gains. However, this is only allowed if one is filing their taxes for the assessment year.
The tax deduction from salary depends on 3 major factors i.e total salary received, exemptions, deductions, investments, and applicable tax slab. From the total salary, the exemptions, deductions, investments are deducted. Then the basic tax exemption is provided on the net salary and tax is deducted on the rest of the income as per the slabs.
The maximum tax you can save on your salary depends on the investments and expenses you make during the financial year. A few deductions and expenses have a limit while others are allowed on an actual payment basis without any limit.
You can save your income tax on salary investing across various products that qualify for tax exemption. You can save up to Rs 1.5 lakhs under section 80C. Some of the products that fall under Section 80C are Public Provident Fund (PPF), NSC, Equity Linked Savings Scheme (ELSS mutual funds), and 5-Year Fixed Deposits (FDs), National Pension, Scheme (NPS), and Senior Citizen Savings Scheme (SCSS). NPS and SCSS are suitable for retirement planning. Secondly, repayment of an education loan without any limit. A contribution to a charitable institution upto 100% of donation amount. A health insurance up to Rs 75,000. A repayment of interest on home loan up to Rs 2 lakh for a self-occupied property. There is no upper limit on interest on a home loan if you let out the house property.
Tax planning is very important to ensure that one doesn’t pay tax unnecessarily on their income. Therefore, tax planning helps minimize the tax outflow by taking full advantage of the tax savings instruments available. To do this accurately, Scripbox’s Income Tax calculator can help in determining the taxable income. It also suggests the appropriate products to invest that one can buy online. Therefore, by investing in 80C instruments, one can avail tax benefits.
No, income tax is calculated on the net salary. A net salary is the gross salary minus the allowances and deductions for the financial year.
The total monthly taxable income is the total taxable income for the financial year divided by 12 months. To calculate the net taxable salary you can use Scripbox’s income tax calculator. All you need to do is provide the details of your salary. The calculator will calculate the taxable income as well as net tax payable for the financial year.
Income tax is calculated on monthly salary by arriving at the yearly taxable salary and tax payable. Your employer will calculate the total taxable income including salary at the beginning of the financial year. On such taxable income the employer will calculate the deductions available and the net taxable income. Then the employer will calculate the tax payable for the financial year. The income tax on your monthly salary will be tax payable for the year divided by 12 months. If you have joined during the financial year the monthly tax will be tax payable divided by the number of months remaining for the year. Such monthly tax will be deducted from the monthly salary and deposited to the Government as tax deducted at source.
Your income tax return or refund arises if the tax payable is less than the taxes already paid during the tax year. Usually for a salaried taxpayer a refund arises if either the deductions are not taken into account or he/ she earns a lower income than estimated income.
As per Budget 2023 the default tax regime will be the new income tax regime and the taxpayers can choose to opt for the old income tax regime. A standard deduction of Rs 50,000 is applicable under both new and old tax regime.
Budget 2020 had given the option to the taxpayers to either continue under the old regime or move towards a new regime of taxation. The major difference between the two is on account of change in the tax rates under various slab along with foregoing of certain benefits under the new slab rate.
There is no concrete way to say which option better suits a taxpayer. It all depends on the current slab of the assessee, whether or not they are willing to give away the benefits etc. A taxpayer should carefully evaluate both the options considering the pros and cons of each case and decide accordingly which option would suit better.
The basic salary, dearness allowance, reimbursement of personal expenses, Leave Encashment, and City Compensatory Allowance is taxable without any limits or conditions. On the other hand, conveyance allowance, house rent allowance, and medical reimbursement are partially taxable. Furthermore, a salary income up to the basic tax exemption limit is not taxable.
No, section 80C exemption is not removed. If the taxpayer is opting for the new tax regime, deductions under section 80C cannot be claimed. The Section 80C deduction is not removed. The claim has been restricted for taxpayers opting for a new tax regime.
Yes, the taxpayer can switch the regime each year from old to new or vice-versa. However, the taxpayer having business income would not be able to utilize this option. In simple terms, this would mean that salaried individuals and pensioners would be eligible to switch between a new tax regime and the old tax regime as per their convenience every year provided they don’t have business income.
No, income tax is not calculated on gross income. It is payable on the ‘total income’ and not the gross total income as calculated in accordance with the income tax act. The gross total income is the sum of income under the six income heads. The deductions available to the taxpayer are deducted from gross total income, this is the net total income. The tax is payable at the applicable tax rate or tax slab on the net income.
The TDS is deducted on salary income depending on the net tax payable by the assessee or taxpayer. If the total taxes paid is more than the total tax payable at the time of filing of ITR then you will receive a refund of the TDS deducted earlier. Hence, make sure you plan your taxes, make tax-free investments like ELSS, claim all the eligible deductions to get that TDS refund. Further, remember you must file the income tax return on or before the due date to claim the tax refund. To know more about TDS and tax refunds refer to our guide.
The self-assessment tax is the tax payable to net taxable income minus taxes already paid. To calculate the self-assessment tax first calculate the net taxable income after giving into effect every deduction and exemption. Now calculate the total tax payable on such net taxable income. Self-assessment tax will be total tax payable minus taxes already paid i.e. TDS/ TCS, advance tax, tax relief under section 87A/90/90A/91, tax credit, AMT/ MAT. You can also refer to Scripbox’s Income Tax Calculator to calculate the total tax payable on income earned.
A taxpayer can consider the below in order to reduce their taxable income: A taxpayer can claim a deduction up to Rs. 1,50,000 under section 80C of the income tax act. However, the same is not available if the taxpayer is opting for the new tax regime.An exemption can be claimed for House rent allowance. Interest paid on your housing loan can be claimed.Contribution towards National Pension Scheme or Health Insurance.
Such an exempt income depends on the type of taxpayer. For an individual, an income up to Rs 3 lakhs is not taxable in India. However, for senior citizens and super citizens, an income up to Rs 2.5 lakhs is not taxable in India as per new tax regime. Moreover, taxpayers other than individuals have to pay taxes irrespective of the amount of income. There is no exemption or non-taxable income. The taxpayers such as companies, HUFs, partnership firms, and body of individuals have to pay tax on their net taxable income.
Yes, it is mandatory to file an income tax return in India. For individuals, if the gross total income exceeds the basic exemption limit then it is mandatory. Here it is to be noted the condition is applicable to gross total income. Hence, while calculating this gross total income, the deductions must not be deducted from the total income. Moreover, if TDS is deducted from the total income then it is recommended to always file ITR. By filing the income tax return the taxpayer can claim a refund on the tax deducted. Other taxpayers like companies, HUFs, partnership firms, and body of individuals need to file irrespective of the total income.
While filing an income tax return you need not attach any document. However, in order to prepare your income tax return, you need a few documents. The taxpayers need their total income calculation, total TDS or advance tax paid, and proof of deductions. To calculate the total income a salaried individual would need their Form 16. To know the total TDS or advance tax paid, the taxpayer must refer to Form 26AS. The Form 26AS can be downloaded from the Traces website by logging in to their account. To calculate the total eligible deductions, the taxpayers will need proof of payment or fulfilling the conditions.
If you do not file your income tax return on or before the due date then you will have to pay a late fee and interest. A late fee of Rs 5,000 is applicable for the late filing penalty. However, the late fee will be restricted to just Rs 1000 if the total income is less than Rs 5,00,000. Moreover, if tax is payable then interest will be applicable till the date of payment. Furthermore, you will receive an income tax notice asking you to file your income tax return. Hence, it is advisable to always file the ITR within the due date to avoid these hassles. You can later revise your ITR if you find any concerns in your ITR.
Yes, you can get a tax refund for previous years. However, to claim a tax refund you must have first filed your income tax return. If you have not filed the income tax return for these previous years then you will have to apply to the Income Tax Department. For a claim of less than Rs 10 lakhs, Principal Commissioners of Income-tax/Commissioners of Income-tax have the right to accept or reject the application. This application must be made to the respective income tax commissioner in person. However, no application for a claim of refund/loss is accepted over six years from the end of the assessment year for which such application/claim is made.
Also, if you have discovered that you are eligible for a tax refund for previous then you can file a revised return. However, you can file a revised return only if you have filed the original ITR before the due date. Furthermore, you can file a revised return 3 months prior to the end of the relevant assessment year. Also, a taxpayer cannot revise an ITR after the completion of the assessment of income.
A late fee of Rs. 5,000 is applicable for the late filing penalty. However, the late fee will be restricted to just Rs 1000 if the total income is less than Rs. 500,000. Moreover, if tax is payable then interest will be applicable till the date of payment.
The basic tax exemption limit for a salaried employee is Rs 3 lakhs under new tax regime. However, the minimum salary to pay income tax is Rs 6,00,000. This is because an individual can claim a tax rebate under section 87A up to Rs 15000 as tax payable. However, to claim the rebate the income must be less than Rs 7,00,000. Furthermore, you cannot claim a tax deduction of up to Rs 1.5 lakhs under section 80C for the new tax regime.
There is no tax on the balance amount in the bank. However, if you earn interest on the savings account balance from the bank then such interest is taxable. Furthermore, if the total interest during the financial year is less than Rs 10000, it is exempt from tax.
There are many components of salary that are not taxable, partially taxable or completely taxable. The non-taxable and partial taxable components are EPF, LTA leave travel allowance, HRA, child education allowance, conveyance allowance, tiffin, and meal allowance.