Incomes tax returns are really important documents for all the citizens of the country. It is a form in which a working individual enlists his/her income and the tax applied thereupon. This information is shared for the benefit of the Income Tax Department of India with which they keep track of their citizens and know whether they are paying their due taxes. ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7 are some of the forms in which the returns are filed.
What is an Income Tax Return Calculator?
If you are still wondering what an income tax return calculator is, then know that it is an easy tool that helps us to estimate our taxes. These tools are rather simple and behave as easy-to-use online tools that you can use to evaluate your taxes based on your income after the Union Budget is presented. Besides, if you opt for it now, you can also avail of the updated version of the tool along with the income tax changes that are proposed in the Union Budget 2020-2021.
Easy ways to use the Income tax calculator for FY 2020-21 (AY 2021-22)
If you haven’t yet checked out the latest income tax calculator for the financial year 2020-2021, then these are the step by step ways to use the tax calculator:
1. First, you need to select the financial year for which you want to calculate your taxes.
2. You need to select your age accordingly. Tax liability in India differs based on the age groups.
3. Then, you have to click on ‘Go to Next Step’
4. Next, you need to enter your taxable salary. This will be the salary you will be entitled to after the deduction of the numerous exemptions such as HRA, LTA, standard deduction, and others. (in case you want to know your tax liability under the old tax slabs). And if not, then you just need to enter your salary. This will be the salary without availing exemptions such as HRA, LTA, standard deduction, professional tax and others. (in case you want to know your tax liability under the new tax slabs)
5. Now, along with the taxable salary, you also have to enter other details such as interest income, rental income, interest paid on home loan for rented, and interest paid on loan for a self-occupied property.
6. Now, you have to click on ‘Go to Next Step’ one more time.
7. If you want to calculate your taxes under the old tax slabs, you will then have to enter your tax-saving investments under section 80C, 80D, 80G, 80E and 80TTA.
8. Next, you need to click on the ‘Calculate’ option to get your tax liability. Besides, you will also be able to see a comparison of your pre-budget and post-budget tax liability (old tax slabs and new tax slabs).
In case something isn’t applicable, there you can enter “0”.
In the end
Filing income tax returns isn’t hard at all because with all the new and innovative technology and the cutting-edge tax software, you can simply wait and watch without bothering even by a dint!