Dec 30, 2009

DTC Tax Calculator

Photo by Mishelle Lane

You must have heard a lot of stories about the impact of DTC on your tax liability. Why not calculate it yourself? To know your tax liability under the new Direct Tax Code (DTC), try this DTC Tax Calculator:

To calculate your tax under DTC, first you need to know your total income. But, what if you don’t have any idea about your total income under DTC? Please note, the purpose of this calculator is not to calculate your exact tax liability under DTC regime but to arrive at an approximate figure. Let me give you a hint: your almost entire salary package is taxable with the exception of transport allowance. Similarly entire capital gains are taxable including long term gains although you’ll get the benefit of indexation.

If you can just make a rough estimate of your total annual earnings (salary + property income + capital gains + business income + other income), this calculator will help you get a fairly good idea about your tax liability under the New Tax Code.

Here’s the tax calculator as per DTC

DTC INCOME TAX CALCULATOR


Notes / Instructions for Using Tax Calculator:
1. The calculator is meant only for tax calculations of resident individuals. In other words, it is not applicable for non-residents.

2. It is presumed that there is no agricultural income.

3. Income from ordinary sources includes following income:

a. Income from employment
b. Income from House Property
c. Income from business
d. Capital Gains (both short term and long term)
e. Other Income

4. Other Deductions includes the following:

a. Deduction for interest on loan taken for higher education [Section 68] (Replaces section 80E of IT Act, 1961)

b. Deduction for medical treatment of certain specified diseases [section 70] (Replaces section 80DDB of IT Act 1961)

c. Deduction for maintenance of a disabled dependent [section 71] (Replaces section 80DD of IT Act 1961)

d. Deductions for donations [section 72, 73] (Replaces section 80G of IT Act 1961)

e. Deduction in case of a person with disability [section 79] (Replaces section 80U of IT Act 1961)

The terms and conditions are also almost similar to various existing deductions under section 80 (such as 80E, 80DD, 80DDB & 80U).

5. In the “Tax Payer Status” column of the calculator, please enter 1 for senior citizens [i.e., if you’re an individual (man / women) above 65 years at any time during the financial year, 2 for Women and 3 for other individuals.

6. Rounding-off of income is ignored.


So, what do you observe: an increase (or decrease) in your tax liability?

In next part, I’ll compare tax liability of a salaried tax payer under current tax regime vis-à-vis New Tax Code.

Also see:
1. DTC: Tax Rates / Slabs
2. Impact of DTC on Life Insurance
3. Tax Calculator FY 2009-10

2 comments:

  1. Is the DTC Calculator for NRI or Resident Indian?

    ReplyDelete
  2. Sundaram,

    Please read the notes and instructions for using the calculator.

    ReplyDelete

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