As another step of simplifying tax laws, the Finance Bill 2020 has introduced a new tax regime for individuals and HUF by insertion of section 115BAC. Now, the individuals and HUF have an option to calculate their income tax liability either under old tax regime or under new tax regime. In order to make an informed decision, the individual will have to calculate its tax liability under old tax and new tax regime, post which the individual will be in a position to decide which tax regime is more beneficial to him. In this background, the income tax calculator has been developed to facilitate the individuals to calculate their tax liabilities under old tax regime and under new tax regime. Salient features of the tax calculator are as follows:
1. Mainly useful for salaried individuals having income from salary, income from house property, income from capital gains and income from other sources.
2. The Calculator is capable to calculate the portion of HRA that will be exempt
3. In case of income from capital gains, the Calculator is capable to calculate the indexed cost of acquisition and the amount of exemption of under section 54/54F/54EC.
4. In case of loss under the head capital gain, the Calculator is capable to set-off the losses from one source against the income from other source.
5. The Calculator is also capable to automatically set-off the losses under House Property against salary income and income from capital gains in tax efficient manner.
6. The Calculator calculates surcharge as per the level of income of the individual.
This tool also provides the income tax liability at different levels of income to help individuals in their analysis.