Every corporate emplyee should know that much about theTax
Hello everyone, welcome back to techbrushup. In this tutorial, we will learn that every corporate emplyee should know that much understanding about the tax as shown below. So guys, Lets get started.
Additional info:
Difference Between Assessment Year (AY) and Financial Year (FY)
Are you confuse between the Financial Year (FY) and Assessment Year (AY) while file their income tax returns.
The Indian Financial Year starts on April 1 and ends on March 31, Every 1st April new financial year will start.
What is Financial Year?
A Financial Year (FY) is the year in which you earn an income.
What is Assessment Year?
The assessment year (AY) is the year that comes after the FY
Example:
| # | Period | Financial Year | Assessment Year |
|---|---|---|---|
| 1 | 1 April 2022 to 31 March 2023 | 2022-23 | 2023-24 |
| 2 | 1 April 2021 to 31 March 2022 | 2021-22 | 2022-23 |
| 3 | 1 April 2020 to 31 March 2021 | 2020-21 | 2021-22 |
For Tax Declaration FY 2022-23, Please understand that TDS will be deducted every month unless the associate’s annual income is less than 5L or they have given the Tax declaration for the fiscal Year.
A fiscal year (FY) is a one-year period of time that a company or government uses for accounting purposes and preparation of its financial statements.
Example: Fiscal year 2022 (July 1, 2021-June 30, 2022)
Hence for now Associates just need to declare an approximate amount for all section 80 and HRA Thus they would need to submit the documents during as per company mostly in DEC 2022-JAN 2023
The amounts is for the entire fiscal Post submission of documents the payroll company will calculate Estimated VS Actuals and make the TDS adjustment. Please understand that Section 80 For 80EEA
HRA: For HRA Exemption PAN Card No. of Landlord, Rental agreement or individual months’ rent receipts are required.
Exemption for you for HRA is based on the following
1. Actual HRA received from employer
2. For those living in metro cities: 50% of Base Pay
3. For those living in non-metro cities: 40% of Base Pay
4. Actual rent paid minus 10% of Base Pay.
The exemption on HRA is calculated as per 2A of Income Tax Rules.
2A of Income Tax Rule: As per Rule 2A, the least of the following is exempted from salary under Section 10(13A) and does not form part of the taxable income.
Tax Liability
tax liability amount that you are liable to pay to the tax authorities. Whether you are an individual or a company, you have to pay taxes.