Income tax

  Section 194B of the Income Tax Act pertains to TDS (Tax Deducted at Source) on winnings from lotteries or crossword puzzles. Here's a breakdown of its key points:   Applicability: Section 194B applies to any person responsible for paying winnings from lotteries or crossword puzzles. This includes individuals, organizations, or any entity responsible for disbursing winnings from lotteries or crossword puzzles.   Types of Payments Covered: TDS under Section 194B is applicable to winnings from lotteries or crossword puzzles conducted by the government or any other entity. This includes prizes, awards, or any other winnings received by individuals or entities participating in such lotteries or crossword puzzles.   TDS Rate: The TDS rate under Section 194B is 30%. This rate is applied to the total winnings, and TDS is deducted at the time of payment.   Threshold Limit: There is no threshold limit mentioned under Section 194B for the applicability of TDS. TDS is app...

 Section 194A of the Income Tax Act deals with TDS (Tax Deducted at Source) on interest other than interest on securities. Here's an explanation of its key aspects:   Applicability: Section 194A applies to any person responsible for paying interest other than interest on securities. This includes individuals, Hindu Undivided Families, companies, or any other entity responsible for paying interest on various financial transactions.   Types of Payments Covered: TDS under Section 194A is applicable to interest payments made on various financial transactions such as fixed deposits, recurring deposits, savings accounts, or any other deposit schemes offered by banks or financial institutions. It also includes interest paid by co-operative societies, post offices, or any other entities offering financial products generating interest income.   TDS Rate: The TDS rate under Section 194A varies based on the nature of the payee and the type of financial transaction. For individu...

  Section 193 of the Income Tax Act deals with TDS (Tax Deducted at Source) on interest on securities. Here's an explanation of its key aspects:    Applicability: Section 193 applies to any person responsible for paying interest on securities. This includes individuals, Hindu Undivided Families, companies, or any other entity responsible for paying interest on securities.   Types of Payments Covered: TDS under Section 193 is applicable to interest payments made on securities such as debentures, government securities, bonds, and other similar financial instruments.   TDS Rate: The TDS rate under Section 193 varies based on the type of security and the nature of the payee. For interest payments to residents, the TDS rate is generally 10%. For non-residents, the TDS rate may differ and is governed by tax treaties between India and the respective country of the non-resident.   Threshold Limit: There is no specific threshold limit mentioned under Section 193 for...

  Section 194I of the Income Tax Act deals with TDS (Tax Deducted at Source) on rental payments. Here's a breakdown of the key points: Applicability: Section 194I applies to any person (other than an individual or Hindu Undivided Family) who is responsible for paying rent to a resident. It also applies to individuals or Hindu Undivided Families who are subject to tax audit under Section 44AB in the preceding financial year. Types of Payments Covered: Rent payments for land, building, furniture, fittings, or plant and machinery are covered under Section 194I. TDS Rate: If the annual rent exceeds ₹2,40,000, TDS is applicable. The TDS rate for rent payments under Section 194I is 10%. However, if the payee does not provide their PAN (Permanent Account Number), the TDS rate increases to 20%. Threshold Limit: If the total rent paid or credited during the financial year doesn't exceed ₹2,40,000, TDS is not applicable. For example, if the annual rent is ₹2,00,000, TDS won't be dedu...

      TDS (Tax Deducted at Source) under Section 192 of the Income Tax Act refers to the deduction of tax from salaries by employers before paying them to their employees. Here's a simple explanation with an example: Let's say you work for a company and earn a monthly salary of ₹50,000. As per the income tax laws, your employer is required to deduct a certain amount of tax from your salary every month before paying it to you. This deducted amount is known as TDS. Now, under Section 192, the employer calculates the TDS based on your salary income and the applicable tax rates. They deduct this TDS amount from your salary and deposit it with the government on your behalf. For instance, if the applicable tax rate for your salary income is 10%, then your employer will deduct ₹5,000 (10% of ₹50,000) as TDS from your salary. So, instead of receiving ₹50,000 in your bank account, you will get ₹45,000 after the TDS deduction. The deducted ₹5,000 will be deposited by your employer ...

Introduction to TDS on Interest Payments When you earn interest from your investments, the government gets a share too. This share is called Tax Deducted at Source (TDS) on interest payments. Here's a simple breakdown of what it means. What is TDS on Interest Payments? TDS on interest payments is a tax that banks or financial institutions deduct from your interest earnings. The Indian Income Tax Department requires this. It applies to various kinds of interest earnings like savings account, fixed deposits, and bonds. Why TDS on Interest? Prevents Tax Evasion: Deducting tax at the source ensures that the government collects tax upfront rather than relying on individuals to report their earnings correctly. Easy for Taxpayers: It reduces the burden on taxpayers to pay a lump sum amount as tax at the end of the financial year. Steady Revenue for Government: It provides a steady flow of revenue to the government throughout the year. Understandi...

Introduction to Salary Taxation Understanding how salary gets taxed is crucial for everyone who earns. Salary taxation is like a big puzzle you solve every year. It involves figuring out how much of your hard-earned money goes to the government. Let's break it down into simpler parts. What Gets Taxed First, not all of what you earn is taxable. Your salary includes your basic pay, allowances, bonuses, and other perks. However, some parts of your salary, like certain allowances and reimbursements, might not be fully taxable. The trick is to know what's fully taxable, partially taxable, or not taxable at all. How It's Calculated The government sets tax slabs. These slabs decide how much tax you pay based on how much you earn. Deductions and exemptions play a hero's role. They reduce your taxable income. Think of them as tax-saving tools. Your employer might deduct tax (TDS - Tax Deducted at Source) from your salary before you receive it. This is their way of pay...

Introduction The government has announced new income tax rates after Budget 2024, along with changes to the income tax return dates. In this blog, we will discuss the income tax slabs and rates for Assessment Year 2425 and Assessment Year 2526. Let's dive into the details without any delay. Assessment Year 2425 and Assessment Year 2526 For both Assessment Year 2024-25 and Assessment Year 2025-26, the financial year will be 2023-24 and 2024-25 respectively. The slab rates for both years are the same, as no changes have been made to the income tax rates in Budget 2024. Let's discuss the slab rates and the new dates. Income Tax Slab Rates Under the old tax regime, if your income is up to INR 2,50,000, you are exempt from paying any tax. If your income is between INR 2,50,000 and INR 5,00,000, a tax rate of 5% is applicable. The difference between INR 5,00,000 and your income will be taxed at a rate of 5%. For income between INR 5,00,000 and INR 10,00,000, a tax rate of 20...