An Income Tax Calculator is an online tool that helps individuals estimate their tax liability based on their income, deductions, and other relevant details. These calculators are designed to provide a quick and accurate calculation of the income tax one needs to pay for a particular financial year. They are user-friendly and can be used by anyone with basic knowledge of their income and expenses.

Income Tax Calculators take into account various factors such as:

• Total income from all sources (salary, business, rental, etc.)
• Deductions and exemptions under different sections of the Income Tax Act (like Section 80C, 80D, etc.)
• Tax slab rates applicable for the financial year
• Applicable surcharges and cess

Using an Income Tax Calculator helps taxpayers plan their finances better by giving them a clear picture of their tax obligations. It also aids in effective tax planning by identifying potential areas where tax savings can be maximized through legitimate means.

Using an Income Tax Calculator is straightforward and involves a few simple steps. Here’s a step-by-step guide to using an Income Tax Calculator:

1. Enter Personal Details: Begin by entering basic personal details such as age, gender, and residential status. This is important as tax slab rates and exemptions can vary based on these factors.
2. Input Income Details: Provide information about your total income from various sources. This includes salary, business income, rental income, capital gains, and any other sources of income.
3. Deductions and Exemptions: Enter details of deductions and exemptions you are eligible for. This can include investments under Section 80C (like PPF, EPF, NSC, etc.), health insurance premiums under Section 80D, education loan interest under Section 80E, and others.
4. Taxable Income Calculation: The calculator will subtract the total deductions from your gross income to arrive at the taxable income.
5. Tax Computation: The calculator will subtract the total deductions from your gross income to arrive at the taxable income.
6. View Result: The final step is to view the result, which will show your total tax payable, including a breakdown of the calculations.

Income Tax Calculators are available on various websites, including the official Income Tax Department website, financial portals, and banking websites. Using these calculators can save time and help avoid errors in manual calculations.

A TDS refund is the process of reclaiming the excess tax deducted at source by the payer if the actual tax liability of the taxpayer is lower than the TDS deducted. This situation typically arises when the income tax calculated on the total income is less than the TDS already deducted.

To claim a TDS refund, taxpayers need to file an income tax return (ITR). The Income Tax Department processes the ITR and verifies the details. If the tax department finds that the TDS paid is more than the actual tax liability, the excess amount is refunded to the taxpayer.

The refund process involves the following steps:

1. File ITR: Ensure that you file your income tax return before the due date, declaring all sources of income and TDS deducted.
2. Verification: After filing the ITR, verify it using methods such as Aadhaar OTP, EVC generated through a bank account, or by sending a signed ITR-V to the Centralized Processing Center (CPC) of the Income Tax Department.
3. Processing: The tax department processes the return, matches the TDS claimed with the TDS details available in Form 26AS, and calculates the refund amount.
4. Refund Issuance: Once the return is processed and approved, the refund amount is credited to the bank account provided in the ITR.

It’s essential to provide accurate bank details and ensure that the KYC norms are fulfilled to avoid any delays in the refund process.

A TDS Refund Calculator helps taxpayers estimate the refund amount they are eligible for if excess TDS has been deducted. Here’s how to use a TDS Refund Calculator:

1. Enter Income Details: Start by entering your total income from various sources like capital gains, rental, and interest income for the financial year.
2. Input TDS Details: Provide the details of TDS deducted on different incomes. This information can be obtained from Form 16 (for salaried individuals), Form 16A (for non-salaried individuals), and Form 26AS.
3. Claim Deductions: Enter the details of deductions you are eligible for under different sections of the Income Tax Act.
4. Calculate Tax Liability: The calculator will compute your total tax liability based on the income and deductions provided.
5. Determine TDS Refund: It will then compare the total TDS deducted with the tax liability calculated. If the TDS deducted is higher, it will show the excess amount as the TDS refund.

Using a TDS Refund Calculator can help you plan your finances better and ensure that you claim the correct refund amount while filing your ITR.

NRI Income Tax Slab Rates for AY 2024-25 (FY 2023-24) – New Tax Regime & Old Tax Regime

NRIs can choose between the existing tax regime and the new tax regime with a lower rate of taxation (Under Section 115BAC of the Income Tax Act). Given below is the table for the latest Income Tax Slabs rates for the FY 2023-24(AY 2024-25)

Note :

• Income tax exemption limit for NRI taxpayers is up to Rs. 2,50,000.
• NRIs opting for the new tax regime with lower rates will not be eligible for certain exemptions and deductions (like 80C, 80D, 80TTB, HRA).
• If they continue to pay taxes under the existing tax regime, NRIs can avail rebate and exemptions.
• NRIs can avail the new tax regime in India but they can’t claim the rebate on full tax for income up to Rs. 7 lakh. Only residents can claim the rebate on it.

Non-Resident Indians (NRIs) should file an Income Tax Return (ITR) in India if they meet any of the following conditions:

• Their total income in India exceeds the basic exemption limit.
• They want to claim a refund for excess TDS deducted.
• They have any income earned from investments, property, or any other source within India.

NRIs are only taxed on the income that is earned or accrued in India. Income earned outside India is not taxable for NRIs. Common types of income that NRIs might need to report include:

• Rental income from property in India
• Capital gains from the sale of assets or securities
• Interest income from savings accounts, fixed deposits, and other investments in India

Filing ITR is essential for NRIs to comply with Indian tax laws, avoid penalties, and ensure that they can claim refunds or carry forward losses for future adjustments.

Many NRIs/OCIs do not file their income tax returns in India basis the assumption that their foreign source funds aren’t taxable in India. However, there may be transactions that they have performed in India that require them to file an NRI Income Tax Return. In many cases, NRIs/OCIs with income less than the exemption limit, i.e. Rs 2.5 lacs do not file the returns, again with the assumption that they are exempt from taxation liability.

But there are conditions where an NRI/OCI needs to file an ITR even if the income is less than Rs 2.5 lacs in India. Here are those:

• If you have deposits or aggregate of more than 1 cr in one or more current accounts
• If you spend more than 2 lacs on foreign travel
• If you spend more than 1 lacs on electricity expenditure

Furthermore, there are three additional cases where they need to file ITR for NRI in India:

• Occupant of immovable property
• Holder of credit card (Not add-on card)
• Owner or lessee of motor vehicle

Due to these discrepancies and cases where NRIs/OCIs have missed their ITR returns, Income Tax department may issue a notice or intimation to the user to verify the tax evasion and liability. It is advised that NRIs file ITR returns to abide by the compliance and avoid any notices.

If you reside and work abroad, your tax liability as an NRI will depend on your residential status for the year. Residential status of an individual is divided into three categories – Resident and Ordinarily Resident (ROR), Resident but Not Ordinarily Resident (RNOR) and Non-Resident (NR). The scope of taxation in India based on the residential status of an Individual would be as under:

Filing an ITR in India offers several benefits for NRIs, including:

1. Claiming Refunds: NRIs can claim refunds for any excess TDS deducted on their income. This is particularly useful for those who have significant investments or income sources in India.
2. Avoiding Penalties: Filing ITR helps NRIs avoid penalties and interest on unpaid taxes. Non-compliance with tax filing requirements can result in hefty fines.
3. Establishing Financial Credibility : A consistent record of filing ITRs can help NRIs establish financial credibility, which can be beneficial when applying for loans or credit cards in India.
4. Claiming Deductions: NRIs can claim various deductions available under the Income Tax Act, which can reduce their overall tax liability.
5. Carrying Forward Losses: Filing ITR allows NRIs to carry forward capital losses to future years, which can be set off against future capital gains, reducing tax liability in subsequent years.
6. Compliance with Legal Requirements: Filing ITR ensures that NRIs comply with Indian tax laws, which is crucial for avoiding legal complications.

Filing ITR as an NRI involves the following steps:

1. Determine Residential Status: Confirm your residential status for the financial year to ensure you qualify as an NRI.
2. Collect Required Documents: Gather all necessary documents, including:
   • Passport (for residency status verification)
   • Form 16/16A for TDS details
   • Form 26AS for a summary of taxes paid
   • Bank statements
   • Investment proofs
   • Rental agreement (if applicable)
3. Choose the Correct ITR Form: For NRIs, ITR-2 or ITR-3 is typically used based on the sources of income. ITR-2 is for individuals with income from salary, house property, capital gains, and other sources, while ITR-3 is for those with income from business/profession.
4. Login to the Income Tax Portal: Visit the Income Tax Department’s e-filing portal and log in using your PAN and password.
5. Fill the ITR Form: Enter the details of your income, deductions, and TDS in the appropriate sections of the form.
6. Validate and Submit: Review the details, validate the form, and submit it. After submission, you need to verify the ITR using any of the available methods such as Aadhaar OTP, EVC through a bank account, or by sending a signed ITR-V to the CPC.
7. Keep Acknowledgment for Records: After verification, an acknowledgment is generated, which should be saved for future reference.

Filing ITR as an NRI ensures that you comply with Indian tax laws and can claim any refunds or benefits you are entitled to.

NRIs have specific guidelines to follow when filing their income tax returns in India. There are two forms to file ITR for NRI when filing returns. The choice of the ITR form depends on the sources and amount of their income. Here’s a detailed look at the appropriate forms for NRIs:

• ITR 2 : This form is suitable for filing ITR for NRI who do not have income from a business or profession in India. It covers income from salary, house property, capital gains, and other sources, making it the appropriate choice for most NRIs.
• ITR 3: NRIs having income from a business or profession in India should use this form. It accommodates a broader range of income sources, including business and professional earnings.

Note: NRIs cannot use ITR 1 . This form is exclusively for resident individuals with income from salary, one house property, and other sources, and total income should not exceed ₹50 lakh. Since they do not qualify as residents, they need to opt for other ITR forms for NRIs.

At SBNRI, we have simplified ITR filing for NRIs/OCIs through a smooth digital journey. Be it Basic Filing, Advanced Filing (includes Capital Gain, etc.), or Premium Filing (Foreign Income), we can help you assess the right computation and lower your tax liability.

“We’ve helped over 500+ NRIs/OCIs file ITR returns and more than 25,000+ across other taxation services last financial year and we’d love to help you out too”

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