Understanding Income Tax
Income tax is an annual levy by the Indian government on income earned by residents during a financial year (April 1 – March 31). This revenue supports public infrastructure, social programs, and development initiatives.
Types of Taxes in India
Direct Taxes: Levied directly on income, including income tax and corporate tax.
Indirect Taxes: Levied on goods and services, such as GST (Goods and Services Tax) and VAT (Value Added Tax).
Who Should Pay Income Tax?
The obligation to pay income tax depends on your age and income level:
Individuals below 60 years: Must pay if their annual income exceeds Rs. 2.5 lakhs.
Senior Citizens (60-80 years): Must pay if their annual income exceeds Rs. 3 lakhs.
Super Senior Citizens (above 80 years): Must pay if their annual income exceeds Rs. 5 lakhs.
Entities: This includes companies, businesses, Hindu Undivided Families (HUFs), and Association of Persons (AOPs).
Types of Income Taxable
The Income Tax Department classifies income into five categories:
Salary Income: Earnings from employment, including salaries and pensions.
House Property Income: Rental income from residential properties.
Business or Profession Income: Profits earned from business activities or professional services.
Capital Gains Income: Profits from selling capital assets like stocks or real estate.
Other Sources Income: Earnings such as interest from savings accounts or lottery winnings.
Income Tax Slab Rates (FY 2023-24)
New Tax Regime
| Income Range | Tax Rate |
| Up to Rs. 3 lakh | Nil |
| Rs. 3 lakh – Rs. 6 lakh | 5% |
| Rs. 6 lakh – Rs. 9 lakh | 10% |
| Rs. 9 lakh – Rs. 12 lakh | 15% |
| Rs. 12 lakh – Rs. 15 lakh | 20% |
| Above Rs. 15 lakh | 30% |
Old Tax Regime (Below 60 years)
| Income Range | Tax Rate |
| Up to Rs. 2.5 lakh | Nil |
| Rs. 2.5 lakh – Rs. 5 lakh | 5% |
| Rs. 5 lakh – Rs. 10 lakh | 20% of amount exceeding Rs. 5 lakh |
| Above Rs. 10 lakh | 30% of amount exceeding Rs. 10 lakh |
Senior and Super Senior Citizen Tax Rates
| Income Range | Rates (60-80 years) | Rates (above 80 years) |
| Up to Rs. 3 lakh | Nil | Nil |
| Rs. 3 lakh – Rs. 5 lakh | 10% | Nil |
| Rs. 5 lakh – Rs. 10 lakh | 20% | 10% |
| Above Rs. 10 lakh | 30% | 20% |
Advance tax allows you to pay your tax liability in installments throughout the year. Here are the deadlines:
| Due Date | Advance Tax Payable |
| June 15 | 15% |
| September 15 | 45% |
| December 15 | 75% |
| March 15 | 100% |
Steps to File ITR Online:
Gather Documents: Collect Form 16 from your employer and proof of investments.
Download Software: Obtain IT preparation software from the Income Tax Department website.
Compute Tax: Calculate your tax payable and any applicable refunds.
File Return: Log on to the Income Tax e-filing portal and complete the filing process.
Demystifying Your Income Tax Deadlines: A 2024 Calendar
This table provides a clear and concise overview of key income tax deadlines for individuals and businesses in India for the financial year 2023-24 (Assessment Year 2024-25). Remember, these are general deadlines, and specific situations may require earlier action.
| Date | Task | Who It Applies To | Description |
| 15 March 2024 | Fourth Instalment of Advance Tax | Taxpayers with estimated tax liability | This is the final instalment of advance tax for FY 2023-24. Pay any remaining tax liability to avoid interest charges. |
| (Flexible) | Submission of Investment Proof | Individuals claiming deductions under Section 80C and other sections | While there’s no fixed deadline, submit investment proofs (like receipts for ELSS, PPF contributions) before filing your ITR to claim deductions. |
| 15 June 2024 | First Installment of Advance Tax | Individuals and businesses with estimated tax liability for FY 2024-25 | Start paying your advance tax for the new financial year to avoid penalties. |
| 31 July 2024 | ITR Filing for Individuals (No Audit Required) | Individuals with income from salaries, pensions, one house property, and other sources (ITR-1, ITR-2) | This is the standard deadline for most individual taxpayers to file their income tax returns. |
| 15 Sept 2024 | Second Installment of Advance Tax | Individuals and businesses with estimated tax liability for FY 2024-25 | Pay your second installment of advance tax for the current financial year. |
| 30 Sept 2024 | Submission of Audit Report (Tax Audit Required) | Businesses and individuals with mandatory tax audits | If your tax audit is complete, submit the report to the Income Tax Department by this date. |
| 31 Oct 2024 | ITR Filing for Businesses Requiring Audit | Businesses and individuals with mandatory tax audits | Businesses that underwent a tax audit need to file their ITRs by this extended deadline. |
| 30 Nov 2024 | ITR Filing for Businesses with Transfer Pricing Report | Businesses with international transactions exceeding specified limits | If your business requires a Transfer Pricing (TP) report, file your ITR by this specific deadline. |
| 15 Dec 2024 | Third Installment of Advance Tax | Individuals and businesses with estimated tax liability for FY 2024-25 | Pay your third installment of advance tax to ensure you’ve met your tax liability for the current financial year so far. |
| 31 Dec 2024 | Revised/Belated ITR Filing | All taxpayers | Missed the original deadline? You can still file a revised or belated ITR by this date, but late filing fees may apply. |
Income Tax Refund
Think you paid more taxes than you owe? You might be due a refund! The Income Tax Department website lets you easily check if you’re getting money back.” Income Tax Department website.
Tax-Saving Investments
Several investment options can help reduce taxable income:
Equity Linked Savings Schemes (ELSS): Tax deduction under Section 80C.
Unit Linked Insurance Plans (ULIP): Market-linked insurance schemes with tax benefits.
Life and Health Insurance: Premiums are deductible under Section 80C.
Education Loan: Interest paid is deductible under Section 80E.
Home Loans: Deduction up to Rs. 1.5 lakh for financial year.
Other Tax-Saving Instruments
Fixed Deposits (FD): Lock-in period of five years qualifies for tax deductions.
National Saving Certificate (NSC): Safe investment with a 5-10 year lock-in period.
Provident Fund (PF): Contributions to PF accounts reduce taxable income.
Income Tax Deductions
Various sections of the Income Tax Act provide for deductions:
Section 80C: Investments and expenses up to Rs. 1.5 lakh.
Section 80D: Health insurance premiums.
Section 80E: Interest on education loans.
Section 80TTA: Interest from savings accounts, up to Rs. 10,000.
Section 24: Interest on housing loans, up to Rs. 2 lakh.
Taxfiniti: Your Partner in Tax Services
At Taxfiniti, we understand that dealing with income tax can be overwhelming. Based in Delhi, we offer a comprehensive range of tax services tailored to meet your specific needs. Our services include:
Individual Tax Preparation: Personalized assistance to ensure your tax returns are filed accurately and on time.
Corporate Tax Services: Expert guidance for businesses to manage their tax obligations efficiently.
Income Tax Return Filing: Comprehensive support for filing income tax returns, ensuring compliance and maximizing benefits.
Tax Planning and Advisory: Strategic planning to minimize your tax liabilities and optimize your financial position.
With Taxfiniti, you can rest assured that your tax matters are handled with the utmost professionalism and expertise. Our goal is to provide you with peace of mind and help you achieve your financial goals.
Conclusion
Understanding and managing income tax is crucial for both individuals and businesses. By staying informed about the types of income tax, the filing process, and the benefits of professional tax services, you can navigate the tax system more effectively. Companies like Taxfiniti offer invaluable support, ensuring your tax affairs are in order and helping you make the most of your financial situation. Whether you need assistance with individual tax preparation, corporate tax services, or strategic tax planning, Taxfiniti is here to help you every step of the way.