Income Tax for Freelancers – 5.TAXABLE INCOME & Calculate INCOME TAX

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5.1 Calculate TAXABLE INCOME

Taxable Income = NET Income – Total Deductions

This is the actual non-savings part of the NET income upon which one is expected to pay tax to the government.

TABLE 4 –Taxable Income

NET Income from Table 2
Total Deductions from Table 3

(Difference)

Taxable Income  

Next step is to ascertain where your Taxable Income fits in the Income Tax slab table.

5.2 Compute INCOME TAX

Income Tax is calculated on the NET Income.
Use this table ( & a calculator )to compute your Income Tax that need to be paid

General tax payers

Income tax slab (in Rs.) Tax

Approx Tax Amount in Rs

0 to ₹ 2,00,000 No tax   0.00
₹ 2,00,001 to ₹ 5,00,000 10%  ₹ 20,000  – ₹ 50,000
₹ 5,00,001 to ₹ 10,00,000 20%  ₹ 1,00,000 – ₹ 2,00,000
Above ₹ 10,00,000 30%  >₹ 3,00,000

Female Tax Payers

Income tax slab (in Rs.) Tax  
₹ 0 to ₹ 2,00,000 No tax   0.00
₹ 2,00,001 to ₹ 5,00,000 10%  ₹ 20,000 – ₹ 50,000
₹ 5,00,001 to ₹ 10,00,000 20%  ₹ 1,00,000 – ₹ 2,00,000
Above ₹ 10,00,000 30%  >₹ 3,00,000

Senior citizens (Aged 60 years but less than 80 years)

Income tax slab (in Rs.) Tax  
0 to₹  2,50,000 No tax  0.00
₹ 2,50,001 to ₹ 5,00,000 10%  ₹ 25,000 – ₹ 50,000
₹ 5,00,001 to ₹ 10,00,000 20%  ₹ 1,00,000 – ₹ 2,00,000
Above ₹ 10,00,000 30%  >₹ 3,00,000

Very senior citizens (Aged 80 and above)

Income tax slab (in Rs.) Tax  
0 to ₹ 5,00,000 No tax  0.00
₹ 5,00,001 to ₹ 10,00,000 20%  ₹ 1,00,000 – ₹ 2,00,000
Above ₹ 10,00,000 30%  >₹ 3,00,000

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