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Budget 2018 Income Tax Calculator

Calculate your post-Budget 2018 tax liability with this comprehensive income tax calculator. The income tax calculator 2018 has been modified after the tax changes announced by FM Jaitley. You can find out how Arun Jaitley's Union Budget 2018 has impacted your finances. This financialexpress.com and EY budget income tax calculator is the most comprehensive one; it takes into account standard deduction, long-term capital gains tax, rental income from second house property, and covers detailed income, expense and investments heads. (Note: This calculator is for resident individuals below 60 years of age. This Tax Calculation is subject to marginal Relief, if applicable. This calculator does not account for inter head loss adjustments).
Knowledge Partner: EY

 

Financial Year : 2018 - 2019
Assessment Year : 2019 - 2020
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Income From Salary(Per Annum)
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Income from SalaryThis includes salary paid to an employee in cash as well as the taxable perquisites made available to the employee. Employers issue a Form 16 and Form 12BA annually which states the salary and allowances and value of perquisites provided to the employee during the Financial Year.

Income From House Property
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Income from SalarySelf occupied- Any one property (out of the properties held by an individual) can be claimed as self-occupied provided it is not actually let out during the Financial Year.

House property 1 - let out
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House property 1 - let out House property which has been given on rent by an individual for whole or part of the tax year, either for the purpose of residence or business.

Income From Capital Gains
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Income From Capital GainsProfits or gain earned from conversion/ transfer of any capital asset (such as property, shares, securities etc. except for certain category of assets specifically excluded such as movable personal effects, etc.) owned by an individual classifies under the category of Income under the head Capital Gain, the gain so earned can be further classified into long term/ short term depending upon the period of holding of such assets so transferred/ sold/ converted.

Income from Other Sources
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Income from Other SourcesAny income not classified under any other head of income such as salary, house property, business and profession and capital gain falls under the category of income from other sources. Such income primarily includes interest income earned from savings bank account, deposits etc. lottery income, dividend income etc.

Deductions under Chapter V1A
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Deductions under Chapter V1AIn order to compute ‘Total Income’ certain deductions classified into various sections are allowed under Chapter VI A of Income-tax Act, 1961. These deductions depending upon the provisions of each section/ sub section contained under Chapter VI A are adjusted against Gross Total Income of an individual. Such deductions cannot exceed the Gross Total Income of an individual.

Section 80C
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Section 80CThis section of the Income-tax Act, 1961 law provides for investment linked deductions such as, equity linked saving schemes, employee contribution to PF, contribution to PPF, Life Insurance premium, Tuition fee, principal repayment for housing loan etc. The maximum limit for this section is Rs 1.5 lakh.

Section 80CCD
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Section 80CCDDeduction from Gross total income is allowed for contribution to national pension system (NPS). Deduction under for employees contribution is deductible upto 10 percent of salary. This deduction within the overall ceiling of Rs 1,50,000 allowed cumulatively under Section 80C, 80CCC and 80CCD(1). There is an additional deduction (over and above limit of INR 150,000) allowed for employees contribution to NPS upto Rs 50,000 under section 80CCD(1B).

Section 80D
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Section 80DThis section allows deduction for medical insurance premium paid for self, spouse, dependent children upto Rs 25,000. Additional deduction of Rs 25,000 is allowed in respect of premium paid for parents aged less than 60 years, for senior citizen (that is 60 years or more the limit) is enhanced to Rs 50,000.

Medical Insurance Premium and preventive heath check Paid for assessee, spouse and children
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Medical insurance premium is a sum of money that you pay regularly to an insurance company for a health insurance policy. Premium can be paid monthly, quarterly, half-yearly, yearly or one time also (in some cases).

Medical Insurance Premium and preventive heath check Paid for Parents
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Preventive health check up: Taxpayers are allowed to claim a deduction of up to Rs 5,000 every year on expenses related to health check-ups. This deduction is included in the mediclaim deductions allowed under Section 80D.

  

1. Assessment Year: This means a period of 12 months (April to March) immediately succeeding the year of which income is being taxed/ assessed.

2. Salary:

a. HRA: House Rent Allowance is an allowance provided by an employer to an employee to cover the house rent expenditure.

b. Leave Travel Assistance: LTA is the allowance provided by an employer to an employee for expenses incurred on travel within the country but does not include expenses incurred on boarding lodging etc. Exemption is available twice in a block of 4 calendar years. The quantum of expenditure allowed is subject to conditions specified under tax laws.

c. National Pension System: NPS is a defined contribution based pension scheme regulated by Pension Fund Regulatory and Development Authority (PFRDA). The NPS Corporate model allows employers and employees to contribute a certain portion of employee’s salary to NPS. The employer contribution is treated as a perquisite and added to the salary income of the employee. However, the employee is eligible to claim deduction of the employer contribution under section 80CCD (2). The employee is eligible to claim his contribution as deduction under section 80C and is also eligible to an additional deduction under section 80CCD(1B) amounting to Rs 50,000/-. However, the additional deduction can only be availed if the overall limit of Rs 1,50,000/- specified under section 80CCE is exhausted.

3.House Property

a. Municipal Taxes: Any taxes paid to the municipal authorities are allowed as a deduction.

b. Interest on Loan: Interest paid on loan taken for acquisition and/or construction of house property. Such interest is allowed as a deduction while computing income from house property. Further, in case income from house property is a loss, the same can be adjusted against income from salary to an extent of Rs 200,000.

4. Employee Contribution to Provident Fund: The portion which is withheld from employee’s salary on a month on month basis and contributed to provident fund. The contribution amount is allowed as a deduction under section 80C (subject to an overall limit of Rs 150,000).

5. Contribution to Public Provident Fund: Any amount contributed by an employee towards his (including spouse or children) Public Provident Fund account qualifies as deduction under Section 80C (subject to an overall limit of Rs 150,000).

6. LIC Premium: Premium paid by an employee to keep life insurance policy in force. The premium paid qualifies as a deduction under Section 80C (subject to an overall limit of Rs 150,000). The tax benefit is given for premium paid for self, spouse and children of the taxpayer.

7.Tuition fee: This is tuition fee paid to any school, university in India for full time education of spouse or children. The tuition fee paid qualifies for deduction under Section 80C (subject to an overall limit of Rs 150,000).

8. ELSS: A tax payer can claim investment in an Equity Linked Savings Scheme of a mutual fund as a deduction under Section 80C (subject to an overall limit of Rs 150,000)

9. Taxable income/ total income – means income which is taxable after all exemptions and deductions available under the Act.

10. Standard deduction: The Finance Bill 2018 proposes to introduce standard deduction in lieu of transport allowance (which was exempt upto Rs 19,200 per annum) and medical reimbursement (which was tax fee up to Rs 15,000 per annum on production of bills). It is a flat deduction being provided to salaried individuals from their salary in order to meet their day to day expenses. This has been capped at Rs. 40,000 per annum (limited to salary).

11. Medical Insurance Premium: Any premium paid by an individual (including spouse and dependent children) for a medical insurance is allowed as a deduction under section 80D subject to a limit of Rs 25,000 (this is Rs 50,000 for all senior citizen taxpayers). Over and above the limits applicable for individual if he/she is paying medical insurance premium and/or medical expenses for parents then an additional deduction of Rs 25,000 is available (this is Rs 50,000 if parents are senior citizen). An individual can also claim Rs 5,000 under section 80D and within the overall limit as specified above for expenses incurred on preventive health check-up.

12. Finance Bill 2018 proposes to increase the present cumulative Education Cess of 3% to Health and Education cess of 4%.

13. Income From Salary

This includes salary paid to an employee in cash as well as the taxable perquisites made available to the employee. Employers issue a Form 16 and Form 12BA annually which states the salary and allowances and value of perquisites provided to the employee during the Financial Year.

14. Income From House Property

Self occupied- Any one property (out of the properties held by an individual) can be claimed as self-occupied provided it is not actually let out during the Financial Year.

15. Income From Capital Gains

Profits or gain earned from conversion/ transfer of any capital asset (such as property, shares, securities etc. except for certain category of assets specifically excluded such as movable personal effects, etc.) owned by an individual classifies under the category of Income under the head Capital Gain, the gain so earned can be further classified into long term/ short term depending upon the period of holding of such assets so transferred/ sold/ converted.

16. Income from Other Sources

Any income not classified under any other head of income such as salary, house property, business and profession and capital gain falls under the category of income from other sources. Such income primarily includes interest income earned from savings bank account, deposits etc. lottery income, dividend income etc.

17. Deductions under Chapter V1A

In order to compute ‘Total Income’ certain deductions classified into various sections are allowed under Chapter VI A of Income-tax Act, 1961. These deductions depending upon the provisions of each section/ sub section contained under Chapter VI A are adjusted against Gross Total Income of an individual. Such deductions cannot exceed the Gross Total Income of an individual.

18. Section 80C

This section of the Income-tax Act, 1961 law provides for investment linked deductions such as, equity linked saving schemes, employee contribution to PF, contribution to PPF, Life Insurance premium, Tuition fee, principal repayment for housing loan etc. The maximum limit for this section is Rs 1.5 lakh.

19. Section 80CCD

Deduction from Gross total income is allowed for contribution to national pension system (NPS). Deduction under for employees contribution is deductible upto 10 percent of salary. This deduction within the overall ceiling of Rs 1,50,000 allowed cumulatively under Section 80C, 80CCC and 80CCD(1). There is an additional deduction (over and above limit of INT 150,000) allowed for employees contribution to NPS upto Rs 50,000 under section 80CCD(1B).

20. Section 80D

This section allows deduction for medical insurance premium paid for self, spouse, dependent children upto Rs 25,000. Additional deduction of Rs 25,000 is allowed in respect of premium paid for parents aged less than 60 years, for senior citizen (that is 60 years or more the limit) is enhanced to Rs 50,000.

21. Medical Insurance Premium and preventive heath check Paid for assessee, spouse and children

Is a sum of money that you pay regularly to an insurance company for a health insurance policy. Premium can be paid monthly, quarterly, half-yearly, yearly or one time also (in some cases).

22. Medical Insurance Premium and preventive heath check Paid for Parents

Taxpayers are allowed to claim a deduction of up to Rs 5,000 every year on expenses related to health check-ups. This deduction is included in the mediclaim deductions allowed under Section 80D.

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