Income Tax slab 2013-14

Income tax is a tax charged on the annual income of the person if it is cross the maximum exemption limit. Several income tax systems exist with a variety of tax incidence. Income tax can be regressive, progressive and proportional. Whenever tax is charged on the company’s income it is known as profit tax, corporate tax and corporate income tax.

The income tax slab helps to calculate your tax for Year 2013-2014 based on budget 2013budget. Tax exemption limit exceeds to Rs 2 lakhs and other tax rates have changed. Income tax act helps the assesses to save the tax on the annual income. Individual can get a rebate on tax liabilities with the help of income tax act. In this act if a person can invest up to 1 lakh then, it will save income tax on income. There are several ways to save the income tax by investing money on several things.

How much tax you are supposed to pay?

Person must have heard about 'Income Tax Slabs'. Following are the income tax slab for the year 2013-14 is Income tax exemption limit

Up to Rs 2 lakh: No tax

From Rs 2 lakh to 5 lakh: 10%

From Rs 5 lakh to 10 lakh: 20%

Above Rs 10 lakh: 30%

Tax modification for the FY 2013-14 are mentioned below:

1. Age of Senior citizen reduced from 64 years to 60 years.

2. People who are above 80 years to be included in 'Very Senior citizen' category.

3. Exemption limit on tax remains the same i.e. Rs. 20,000 on investment in tax saving.

4. A set of Direct Tax Codes have been proposed, which will be approved from Financial Year 2013.

What are income tax deductions?

People plan their taxes and make investments to avail the tax saving schemes. There are various different investments in which the person can get tax benefits and earn a profit from them. Deductions are tax benefits person might be allowed to avail. If a person income is Rs. 4,00,00 then, person is allowed to deductions of Rs. 1,00,000 and will only have to pay tax on Rs. 3,00,000 at the slab rates.

There are a number of deductions that are:

1. Certain Mutual Funds purchased

2. Housing Loan Repaid

3. Amount deposited in a Public Provident Fund (PPF) Account

4. Premium paid on a Life Insurance Policy

5. ULIPs purchased