Income Tax Calculator - Calculate Tax For FY 2024-25 (AY 2025-26) (2024)

Financial Year

My age is

My city is a

My house is

My earning comes from

I pay rent of

• Yearly
• Monthly

My Gross salary

My Basic salary

Income from interest on savings

Interest on deposits

Income from rentals

Income from any other source

HRA recieved

Special allowance

Dearness allowance

EPF contribution by self

Equity investments

Capital gains arising from short term investments in Equity.

Debt investments

Capital gains arising from short term investments in Debt instruments.

Unlisted shares

Capital gains arising from short term investments in Unlisted shares.

Real estate or Land

Capital gains arising from short term investments in Real Estate or Land.

Basic Deductions - 80C deductions (max. allowed 1.5L)

Amount invested in PPF, VPF, FDs, ELSS funds, Term insurance, LIC, etc.

Health insurance premium - 80D

For self,family, parents

NPS investment - 80CCD(1B) (max. 50,000)

This is over and above the investment limit of 1.5 lacs unders section 80C

Interests on loans - 80E/80EEA

Interest on Education loan, Home loan

Donation to charities - 80G

Mention those eligible for tax deduction

Expenses related to work

Total expenses incurred in running the business. Like office rent, client meeting expenses, contracting expenses, etc

Invest in NPS

An income tax calculator is an online tool that helps individuals calculate the amount of income tax they will owe to the government based on their taxable income. It takes into account various factors such as income sources, deductions, exemptions, and tax credits to calculate the final tax liability.

Users input details such as their annual income, income sources, age, exemptions (like HRA, EPF, DA) deductions (like tax saving investments, loan interest or donations, etc), and other relevant information. The calculator then processes these inputs and provides an estimate of the amount of income tax owed.

You have follow the steps given below to figure out the tax payable on your income for FY 2024-25 or AY 2025-26:

Step 1: Provide your basic details

Select the financial year from the dropdown menu for which you want to calculate the income tax, then input your basic details such as your age group (it tells your applicable tax slab rates), type of city you are living in, earning source, the type of house you are living in, rent that you pay if you are living in a rented house.

Step 2: Income details

Now, add your income details such as your basic salary, and income from other sources, such as interest on savings, interest on deposits, and rental income.

Step 3: Add your exemptions

Next, you need to add the exemptions such as HRA, dearness allowance (DA), special allowance, and your EPF contribution.

Step 4: Input your capital gains

In this part, you can input all the capital gains you have earned in the year through the sale of equity investments, unlisted shares, debt investments, and real estate.

Step 5: Add the deductions

In this step, you need to provide details of your tax-saving investments (such as ELSS, term insurance premiums, NPS, PPF, health insurance premiums, donations to charities) under section 80C, 80D, 80G, 80E and 80TTA, etc. Also, you can enter details like interest paid on an education loan, interest paid on a home loan for rented property, and interest paid on a loan for self-occupied property (if applicable).

Step 6: Get the results

After hitting "Continue", you will see your total taxable income and the total tax that you need to pay under the tax regime that you have chosen.

Now, let’s know how to calculate income tax online by using the tax calculator.

Calculating income tax involves finding out your taxable income based on various sources and applying the applicable income tax slabs. Here are the steps for the income tax calculation for a salaried individual:

Step 1: Calculate your gross taxable income

To calculate your gross taxable income, you need to compute your net salary after subtracting your deductions, such as HRA, LTA, and standard deduction, from your gross salary.

Now, you need to add the net salary with other income from different sources, such as interest income, capital gains from investments, and rental income, to come to your gross taxable income.

Gross taxable income = Gross salary – HRA – LTA – Standard deduction + Income from other sources

Step 2: Calculate the total tax benefits

If you have made any tax-saving investments or are eligible for any exemptions, you need to compute the total benefits. You can cut your taxable earnings by investing in tax saving options such as Equity Linked Savings Scheme (ELSS), and Public Provident Fund (PPF), available under section 80C of the Indian Income Tax.

Total tax benefits = Investments under 80C+ Health insurance premium + savings account interest + home loan interest + others

Step 3: Calculate the net taxable income

In this third step, you need to calculate the net taxable income. You can easily subtract the total tax benefits from the gross taxable income.

Net taxable income = Gross taxable income – net taxable income

Step 4: Calculate your total tax liability

If your total taxable income is less than ₹5 lakhs, you will get a rebate of ₹12,500 under section 87A. For individuals whose total taxable income is above ₹5 lakhs, the tax rate discussed earlier would apply.

If you are going for the new tax regime, the various deductions/exemptions such as HRA, and LTA would be taxable. In addition, you can’t avail of tax benefits by investing in tax-saving instruments and other deductions. So, your entire income would fall under income tax purview.

Let us take an example to see the difference between the old and new tax regimes.

Nehal works in Mumbai and gets a basic monthly salary of ₹1 lakh. Her employer offers an HRA of ₹50,000, a special monthly allowance of ₹20,000 per month, and a yearly LTA of ₹30,000. She stays in a rented house and pays a rent of ₹40,000 per month. Moreover, her additional income from capital gains and interest income is ₹1 lakh in the financial year.

Let us see her total tax liability under the old and new tax regimes.

Now, let us compute the various tax-saving investments and the various deductions. She has invested ₹1.5 lakhs under the different tax saving options under section 80C, an additional ₹50,000 in NPS, and paid medical insurance premium worth ₹25,000 for herself and her spouse.

She also availed a tax deduction of ₹5,000 under section 80TTA against her savings account interest.

So, as per the income tax calculation formula, her total tax deductions for the financial year is ₹2,30,000.

As a result, net taxable income under the old tax regime would be ₹13,90,000, while for the new tax regime, it would be ₹21,20,000.

So, we can see that the total income tax liability for Nehal would be more if she opted for the new tax structure.

Simply put, individuals must calculate the tax payable under both tax regimes and decide which regime to select.

Also, the ability to switch between old and new tax regimes depends on the nature of the income. Salaried individuals and pensioners with no business income can switch between the two tax regimes every assessment year, depending on their financial status. If a non-salaried taxpayer chooses to transfer to the new tax regime in the current assessment year, they will only be able to do so once in their lifetime. They cannot choose the tax rates in the new regime once she has exercised their choice to return to the previous tax regime.

To minimise your taxable income, you could claim tax exemptions on HRA and LTA, as well as deductions under other sections, such as Section 80C, 80D, and 80TTA under the old tax regime.

There are a few other things to keep in mind about the former tax system:

A 4% health and education cess is applied to the tax amount.

A surcharge of ten percent of total income beyond Rs.50,00,000 and up to Rs. 1,00,00,000, and 15 % on income between Rs. 1 crore and Rs. 2 crores, 25% on income between Rs. 2 Crores to Rs. 5 Crores and 37% on income between Rs. 5 crores and Rs.10 crores and income exceeding Rs. 10 crore are applied as well.

Most tax exemptions and deductions are no longer accessible under the new tax regime.

If you have invested in saving schemes or incurred any expenses, they are eligible for deductions. So, before paying taxes, you can deduct these investments from your gross taxable income to reduce your tax liability.

Old Tax Regime

Here is a list of popular deductions and exemptions allowed under the old tax regime:

• For salaried individuals, the standard deduction is Rs 50,000
• LTA exemption for salaried individuals for travel purposes
• An individual or a HUF (Hindu Undivided Family) can claim a tax deduction of up to Rs. 1.5 lakh under section 80C
• Medical expenses are eligible for a deduction under Section 80D
• The interest on a self-occupied home loan can be deducted up to Rs. 2 lakh
• Deduction for Higher Education Loan under section 80E
• Income tax deduction under Section 80G for charitable donations
• Tax deduction of up to Rs. 10,000 on savings account interest income

New Tax Regime

The following deductions are available under the new tax regime 2023:

• Section 24(b) allows for a deduction on interest paid on a home loan for a rented-out property.
• Employer contribution to NPS under 80CCD (1B) is available.
• Similarly, PPF and Sukanya Samriddhi Yojana maturity proceeds and interest remain tax-free. The new tax law only eliminates deductions for investments for these two investment avenues.
• Transport allowances for disabled people.
• Conveyance allowance obtained to cover work-related conveyance expenses.
• Any remuneration paid to cover tour or transfer costs
• Indemnity paid daily to cover routine normal costs or expenses incurred due to absence from a regular place of duty.
• Expenses for additional employees are deducted under Section 80JJA
• Salaried individuals can also take a standard deduction of Rs.50,000 under the new tax regime. Previously this deduction was only available under the old tax regime.
• Contribution to Agniveer C
• Furthermore, Section 57(iia) was introduced under the new tax regime for claiming deductions related to income from family pensions. Now, you can claim a deduction of the one-third amount or 15,000, whichever is less.
• Corpus Fund is eligible for deduction under Section 80CCH.