Budget 2017-18: Income Tax benefit illustrations for all Slabs.. - MYREALITY.In, Real Estate, Share Market, Mutual Fund, Insurance
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Wednesday, February 01, 2017

Budget 2017-18: Income Tax benefit illustrations for all Slabs..

Budget  2017-18: Income Tax benefit illustrations for all Slabs..  

The union government has proposed to decrease the income tax for those earning between Rs. 2.5 Lakh to Rs. 5 Lakh per annum to 5% from 10%. This is a welcome move & would benefit all tax slabs.

 Here is illustrations

1. For those in (old) 10% and new 5% tax slab

Net taxable income after considering all applicable deductions = Rs. 4 Lakh.

OLD SLAB: FY 2016-17 
Total Tax before cess = 10% of income above Rs. 2.5 Lakh = 10% of Rs. 1.5 Lakh  = Rs.15,000
Section 87A can be applied for further deduction.
Rs. 15,000 – 5,000 = Rs. 10,000.

New SLAB FY 2017-18

Total Tax before cess = 5% of income above Rs. 2.5 Lakh = 5% of Rs. 1.5 Lakh  = Rs.7,500

A total saving (before cess) of Rs. 7,500 (but 50%)

Section 87A can be applied for further deduction.

Budget 2017-18 offers a rebate of Rs. 2,500 , Section 87 A from total tax payable before cess for those with a taxable income of Rs. 3.5 Lakh.

Here taxable income of Rs. 4 Lakh, so rebate of Rs. 2,500 not applicable

2. For those in 20% tax slab

Net taxable income after considering all applicable deductions (80c, 80D etc..) =  Rs.7 Lakh.

OLD SLAB  FY 2016-17

 Total Tax before cess = Rs.25,000 (10% slab) + Rs.40,000 (20% slab) = Rs. 65,000

That is 10% of Rs. 2.5 Lakh + 20% of amount above Rs. 5 Lakh = Rs.65,000


New SLAB FY 2017-18

Total Tax before cess = Rs.12,000 (5% slab) + Rs.40,000 (20% slab) = Rs.52,500

That is 5% of Rs. 2.5 Lakh + 20% of amount above Rs. 5 Lakh = Rs.52,500

A total saving (before cess) of Rs. 12,500

3. For those in 30% tax slab

Net taxable income after considering all applicable deductions =  Rs.15 Lakh.

OLD SLAB  FY 2016-17 

Total Tax before cess = Rs.25,000 (10% slab) + Rs.1,00,000 (20% slab) + Rs.1,50,000 (30% slab) = Rs. 2,75,000

That is 10% of Rs.2.5 Lakh+ 20% of Rs. 5 Lakh + 30% of (amout  above 10L) = Rs. 2.75 Lakh

New SLAB FY 2017-18

Total Tax before cess = Rs. 12,500 (5% slab) + Rs.1,00,000 (20% slab) + Rs.1,50,000 (30% slab) = Rs.2,62,500

That is 5% of Rs. 2.5 Lakh + 20% of Rs. 5 Lakh + 30% of (amount  above 10L) = Rs. 2,62,500

A total saving (before cess) of Rs. 12,500


Budget 2017-18: Income Tax benefit illustrations for all Slabs.. Reviewed by S. Chitra on February 01, 2017 Rating: 5 Budget  2017-18: Income Tax benefit illustrations for all Slabs..   The union government has proposed to decrease the income tax for th...

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