Here’s a step-by-step guide to how to calculate income tax for pensioners in India:
Add up all sources of income to arrive at the gross total income.
Deduct the eligible amounts under various sections of the Income Tax Act to arrive at the net taxable income.
Compute Tax Payable
Apply the applicable income tax slab rates to the net taxable income to calculate the tax liability.
Example Calculation:
Pensioner's Details:
- Pension income: ₹6,00,000
- Interest income: ₹1,00,000
- Age: 65 years
- Gross Total Income = ₹6,00,000 (Pension) + ₹1,00,000 (Interest) = ₹7,00,000
- Standard Deduction: ₹50,000
- Section 80TTB: ₹50,000 (interest income)
- Net Taxable Income = ₹7,00,000 - ₹50,000 (Standard Deduction) - ₹50,000 (Section 80TTB) = ₹6,00,000
- Up to ₹3,00,000: Nil (Senior Citizen)
- ₹3,00,001 to ₹5,00,000: 5% of ₹2,00,000 = ₹10,000
- ₹5,00,001 to ₹6,00,000: 20% of ₹1,00,000 = ₹20,000
Tax = ₹10,000 + ₹20,000 = ₹30,000
Health and Education Cess (4%) = ₹30,000 * 0.04 = ₹1,200
- Total Tax Payable = ₹30,000 + ₹1,200 = ₹31,200
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Authors Of The Question
How to Calculate Income Tax for Pensioners in India?
Karan
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1 Answers
6 months
2024-06-04T10:32:00+00:00 2024-06-04T10:32:01+00:00Comment
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