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Budget 2023: What taxpayers must know
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Budget 2023 tweaked the new income tax slabs
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Budget 2023: How your income will be taxed
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Income tax for income of up to Rs 7.5 lakh
Here's the calculation
Your total income: Rs 7,50,000
Standard deduction: Rs 50,000
Total taxable income = Rs 7,50,00-Rs50,000 = Rs 7,00,00
Income between Rs 3,00,000 and Rs 6,00,000: 5% of Rs 3,00,000 = Rs 15,000
Income between Rs 6,00,000 and Rs 7,00,000 = 10% of Rs 1,00,000 = Rs 10,000
Tax liability = Rs 15,000 + Rs 10,000 = Rs 25,000
Rebate under section 87A = Rs 25,000
Tax payable = 0
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When do you have to pay income tax?
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How your tax will be calculated
Your total income = 8 lakh
Standard deduction = Rs 50,000
Total taxable income = Rs 8,00,000 - Rs 50,000 = Rs 7,50,000
Under the new income tax slab, your tax liability will be
Income up to Rs 3,00,000: Nil
Income between Rs 3,00,000 and Rs 6,00,000: 5% of Rs 3,00,000 = Rs 15,000
Income from Rs 6,00,000 to Rs 7,50,000 = 10% of Rs 1,50,000 = Rs 15,000
Tax liability = Rs 15,000 + Rs 15,000 = Rs 30,000
Cess at 4% on Rs 30,000 = Rs 1,200
So you will end up paying Rs 31,200 in income tax. As your income is above Rs 7.5 lakh, you will not be able to claim any rebate under section 87A. Do remember this while filing your income tax return for FY2023-24.
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