Video instructions and help with filling out and completing Fill Form 2220 Rates

Instructions and Help about Fill Form 2220 Rates

Hey what is going on everybody welcome to another video in which we are going to see how to calculate income tax for the financial year 2018 and 19 that will be applicable for the assessment year 2019 and 20 or so we'll see some couple of examples for illustration purpose so let's get started with this video so as you can see we have the income tax lab rates for the people whose ages less than 60 years so compared to the financial year 2017 and 18 there have been no changes that are made in the text lab rates and the text limits as far as financial over 2017 and 18 is concerned so basically we have some changes related to the standard deduction and the health and education says if you want to watch what are the different changes that have been made in the budget 2018 you can watch our video the link to which is in the top right corner of this video right now okay so we have the income tax lab rates okay so for people of age less than 60 years there is no text lab rate for the income which is up to two like fifty thousand and for two like fifty thousand to five likes we have the slap rate of five percent for five like two ten legs we have for twenty percent slab rate and for income beyond ten legs we have 30 percent slab rate so there are no changes compared to the financial year 2017 and eighteen slab rates apart from this we have the surcharge of ten percent for taxable income between 50 likes to one crore and the fifteen percent for the taxable income greater than 1 crore so this is the slab rates as far as people off for age less than sixty is concerned okay so for the people whose age is between sixty years to eighty years we have these slab rates as for the income between for the income which is less than three legs we have 0% tax rate for income between three like two five like it is five percent for income between five likes to ten likes it is twenty percent whereas for income greater than 10 lakhs it is thirty percent again the same surcharge of ten percent for the income between fifty likes one crore and 15 percent for income than one growth so for the people whose age is greater than 80 years there are no changes again in these lab rates compared to the financial year 2017 and 18 so up to five legs there is no tax rate that is applicable for the people greater than 80 years for income between five likes to ten likes it is 20% and for income greater than ten legs it is 30% so this is as far as the income tax lab rates are concerned there were no changes in this lab rates not in the text limits all right so let's come to the example one of our income tax calculation process so let's say we have the income from salary as eight like fifty thousand and the income from other sources as nineteen thousand which comes to the total of four eight like sixty nine thousand and let's say we have the deductions of 480 C a TD and attt a as you can see on the screen that is one like fifty thousand fifteen thousand and nine thousand the total comes to around the one like seventy four thousand now these deductions are subtracted from your gross total income which you have earned in that particular financial year so for this example we can see the difference is six like ninety five thousand so the deduction is removed from the gross taxable income or you can see the cross total income and we get the gross taxable income as the difference of total income and the deductions now a new component that have been introduced in the budget 2018 that is a standard deduction of rupees forty thousand which will be applicable only to salaried employees and pensioners okay so this deduction is applicable to the cross taxable income which will reduce your tax liability alright so your cross sectional income becomes six Lex ninety five thousand minus forty thousand which is equal to six Lex fifty thousand so this is the way how standard deduction will work for salaried employees and pensioners so this will reduce the total tax liability okay so if you think that the cross sectional income that we have that is like 55,000 and according to the text lab rate it is 20 person to pay off this income so if you think that the income tax is calculated in this way and we have to pay the income tax of 1 lakh 31,000 then I would like to tell you guys that this is not the process that how income tax is calculated alright so the processes as you can see on the screen right now is in this way that is for income up to two left fifty thousand we do not have to pay any tax which is zero percent for income between two like fifty thousand to five legs the difference is taken that is true like fifty thousand so five percent of to like fifty thousand is twelve thousand five hundred and then again for the next library that is off twenty percent the difference of four six like fifty five thousand is taken and five legs is taken so six likes fifty five thousand minus five legs which the the twenty percent of this difference which is thirty one thousand all right and since we do not have any income which is greater than ten lakhs then for this component it is zero so basically we are supposed to add all these components and we have something called as tax