What tax do I pay on 5.5 lakhs?
The finance minister announced that individuals with an annual income between Rs 5 lakh and Rs 7.5 lakh would pay 10% tax, and those earning Rs 7.5 lakh to Rs 10 lakh 15%. Under the old regime, with deductions, these individuals pay 20% income tax.
Under this new tax regime, your salary of Rs. 6.5 LPA would fall under the tax slab of 10%. This flat tax rate is far lower than the tax slab that your salary of 6.5 LPA would fall under with the existing tax regime - 20%.
If you make ₹ 450,000 a year living in India, you will be taxed ₹ 64,000. That means that your net pay will be ₹ 386,000 per year, or ₹ 32,167 per month. Your average tax rate is 14.2% and your marginal tax rate is 17.0%.
What this essentially means is that if the total income of a working individual/citizen is INR 5 lakh or below INR 5 lakh in India, then he/she is eligible to get a tax rebate of up to INR 12,500 as per the recently modified section 87A of the Income Tax Act. So, no tax is required to be paid.
- Highlights.
- People earning up to Rs. 5 lakh are now exempt from paying tax.
- Salaried individuals earning up to Rs. 7.75 lakh can also pay zero tax.
- To reduce taxable income to Rs. 5 lakh, invest fully in Sections 80C, 80D, 80CCD(1B), 80TTA.
The finance minister announced that individuals with an annual income between Rs 5 lakh and Rs 7.5 lakh would pay 10% tax, and those earning Rs 7.5 lakh to Rs 10 lakh 15%. Under the old regime, with deductions, these individuals pay 20% income tax.
Abhishek Soni, CEO, tax2win.in, a tax-filing firm says, "As per the proposals of Budget 2019, there will be no tax liability if your taxable income is Rs. 5 lakh or less. However, ITR filing is still mandatory if your income exceeds the basic exemption limit of Rs. 2.5 Lakh (if age is below 60)."
Band | CTC (Yearly) | In Hand Salary |
---|---|---|
C | 12 lakh | 82,000 per month |
C | 10 lakh | 63,000 per month |
D | 8 lakh | 55000 per month |
E | 6 lakh | 40000 per month |
If you make ₹ 600,000 a year living in India, you will be taxed ₹ 105,800. That means that your net pay will be ₹ 494,200 per year, or ₹ 41,183 per month. Your average tax rate is 17.6% and your marginal tax rate is 32.8%. This marginal tax rate means that your immediate additional income will be taxed at this rate.
- Submit all investment proofs for deduction under Section 80C. ...
- Housing loan repayment (principal) ...
- Leave Travel Allowance. ...
- Public Provident Fund (PPF) ...
- Sukanya Samriddhi account. ...
- Benefits under Section 80EE for first-time homebuyers.
How can I save tax on my salary?
- House Rent Allowance (HRA)
- Leave Travel Allowance (LTA)
- Employee Contribution to Provident Fund (PF)
- Standard Deduction.
- Professional Tax.
- Exemption of Leave Encashment.
- Exemption Under Section 89(1)
- Exemption from the Receipt Upon Opting for Voluntary Retirement.
Income | Tax Slab |
---|---|
Up to Rs 5 Lakhs | No Tax |
Between Rs 5 Lakhs – Rs 7.5 Lakhs | 10 percent |
Between Rs 7.5 Lakhs – Rs 10 Lakhs | 15 percent |
Between Rs 10 Lakhs – Rs 12.5 Lakhs | 20 percent |
![What tax do I pay on 5.5 lakhs? (2024)](https://i.ytimg.com/vi/EyNe3otnR7c/hq720.jpg?sqp=-oaymwEcCNAFEJQDSFXyq4qpAw4IARUAAIhCGAFwAcABBg==&rs=AOn4CLClBr1wYDryD2WR8gOjMz0iRXAWfg)
If your income is below ₹2.5 lakh, you do not have to file Income Tax Returns (ITR).
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How do I calculate TDS on my salary?
Income Tax Slabs | TDS Deductions | Tax Payable |
---|---|---|
Rs.2.5 lakhs to Rs.5 lakhs | 10% of(Rs.5,00,00-Rs.2,50,00 | Rs.25,000 |
How to Calculate Sales Tax. Multiply the price of your item or service by the tax rate. If you have tax rate as a percentage, divide that number by 100 to get tax rate as a decimal. Then use this number in the multiplication process.