Reap the Benefits of Free Tax Calculator and Save Taxes

Only three months left in 2017, and the rush for tax planning will start soon. You must have seen that people often do mistake when they are in a hurry, and they do not even get many options at the end of the time. Then, why to take the risk with the necessary work like tax planning? Start planning early with the help of the free online tax calculator and reap the best benefits which are available for you. You can check that how much will you owe in your taxes this year, or you can also calculate if you have any tax refund to be received for the previous year. By calculating the amount that how much you need to pay this April for tax, you can plan the rest of your finances accordingly.

Let’s know how the online tax calculator works efficiently:

Tax planning requires a lot of complicated calculations and details which are not everyone’s cup of tea doing it manually. But after the invention of online tax calculators, it has become effortless to calculate the typical calculation of the tax return. Now anyone can use it to calculate the correct value to be paid. The online tax calculator in India works on the following components to work efficiently and generate actual value each time:

1. The Type of the Assessee: To start calculating the amount of tax using the online calculator, one needs to mention the kind that whether the user is an individual, HUF, BOI, Company, etc. It is necessary to mention because the tax slabs and rules are different for various types of the payer. So, when you specify your type at the beginning, the calculator will work on the format accordingly. Henceforth, it will generate the actual amount you need to pay as tax. Moreover, it further asks to mention the age group, if you specify the type of individual, to calculate the tax liability as per the legal slab rates.
2. Residential Status: The Income Tax Act has various rules for the taxes from Resident, NRIs, to RNOR. So, the return calculator asks the residential status to generate the tax amount accurately. It has been designed considering all the latest amendments to the Income Tax Act of India, 1961. So, it shows the correct amount of the liability to be paid by any individual, HUF or any other entity liable to pay taxes residential or nonresidential.
3. Gross Annual Income: Once you have entered the required details as mentioned in the above points, you need to enter your annual income on which you need to calculate your taxes. Your gross annual income is the total amount of your income earned annually, and after the adjustments of any deductions or claims (if any) are made, the resulting value is the net taxable income for the current year.
4. Mention the Deductions: You need to say if you have claimed any deductions which are referred to in the various sections of the Income Tax Act, like 80C, 80D, etc. Once you mention the claim for the deduction, the calculator automatically will calculate the correct amount which is to be paid as the income tax return.

Therefore, people are using an online tax calculator widely because it is effortless to use and free of cost. Enter the required details and get done with your tax calculation within a flip. In this article, you will read about the various components of the online tax calculator on which it works efficiently and generates the exact results each time you use.

Dishika is well-versed with the ups and downs of the financial market and has published articles on mutual fund and SIP. She is associated with MySIPonline.com, which is an AMFI registered mutual fund company.