Millions of people across India are now rushing to file their Income Tax Returns ahead of the extended deadline. All taxpayers in the country are expected to make their submissions by September 15 while those requiring an audit must file by September 30. There have been several key changes made to the income tax slabs and compliance rules over the past year — leaving many confused about their exact tax liabilities. An online income tax calculator (such as the one shared on the I-T website) can be particularly helpful in such cases.
What has changed in 2025?
The Budget announced by Finance Minister Nirmala Sitharaman in February 2025 introduced several relief measures for middle-income earners. The basic exemption limit has now been raised to Rs 4 lakh while rebate under Section 87A was increased to Rs. 60,000 for taxable income up to Rs 12 lakh (both under the New Tax Regime). The government had also announced zero income tax for income up to Rs 12 lakh under the new tax regime — providing substantial savings to taxpayers.
The tax brackets have also been modified — starting at 5% for those with income between Rs 4 lakh and Rs 8 lakh. Those earning between Rs 8 lakh and Rs 12 lakh face a 10% tax while income between Rs 12 lakh and Rs 16 lakh incurs a 15% tax. Taxpayers are charged 20% for income between 16 lakh and 20 lakh while the next bracket (up to Rs 24 lakh) sees a 25% tax rate. Any individual earning above Rs 24 lakh is charged a flat 30% income tax. Salaried individuals get a standard deduction of Rs 75,000 while calculating taxable income under this regime.
How to use an Income Tax Calculator?
Several financial websites, including the official Income Tax Department website, offer a calculator — allowing taxpayers to understand their total liabilities within minutes. Basic details, including the assessment year, type of taxpayer, age and residential status must be shared using the drop-down menu. The taxpayer will also have to input their net taxable income and whether they are opting out of the new tax regime. The website automatically calculates the details — sharing information such as ‘Income Tax after relief u/s 87A’ and ‘total tax liability’ as well as any cess and surcharge.
Steps to check your exact tax liability
- Open the Income Tax Department website and find the ‘Tax Calculator’ or click on the direct link given here.
- Choose the financial year for which you want taxes calculated using the dropdown menu. It will be 2024-25 for the current submission.
- Select your tax payer category. It will be individual for all salaried taxpayers, pensioners, and those with income from interest, or house property etc. Those earning from capital gains on stocks or mutual funds will also fall under the ‘individual’ category.
- Select your relevant age category and residential status.
- Enter your net taxable income. You have to first subtract all allowed deductions and exemptions from your total income. The amount left behind is what you will enter for the calculation of tax liability.