How much salary is needed to be eligible for tax paying in India?
Let me split this question into 3 parts and try to answer your question in simple terms.1. How much is tax rate ?So what does that say take for example your are 25 years and getting income of 3,60,000 annually . Upto 2,00,000/- of income from salary you need not pay any tax, if your income is between 2 Lakh to 5 Lakh you have to pay 10% of your income as tax.2. What is TDS?Tax Deducted at Source(TDS) is one of the modes of collection of taxes, by which a certain percentage of amounts are deducted by a person at the time of making payment and deducted amount is remitted to the Government account. This ensures regular inflow of cash resources to the Government. It acts as a powerful instrument to prevent tax evasion as well as expands the tax net.Being said this your employer will deduct a certain percentage of your salary and remit it to the government. The rate will be based on the quantum of salary provided to you as shown in the image.3. How much tax you have to pay for 30,000/- monthly income?As per current tax scheme if the income is below 5,00,000/- the government is giving a rebate of 2,000/- taking the above example you have to pay only 14,000/-.Further, there are few more points that are need to be taken care off, but i don't want to make it complicated and confusing to you.
How much TDS will be deducted from my salary. My CTC is 25000 Per Month?
Assuming you have not availed any investment exemptions(1.5 Lakh) and have no home loans.Your monthly salary is Rs 25000 . So for one year it would amount to 25K*12 = 3L per annum.Your PF contribution is 1741*12 = 20892Employer's PF contribution is 1741*12 = 20892So the PF contribution is non-taxable so deducting from the salary you have 300000-20892*2 = 258216.Travel allowance non taxable is 1600 p.m. = 1600*12 = 19200So subtracting it from remaining salary : 258216-19200=239016For HRA if you are living in a cities other than Delhi,Bangalore,Mumbai and HyderabadHra exemption would be nearly 3125 per month so tax benefit: 37500 per annum.So subtracting it from remaining salary 239016-37500= 201516.So your taxable income is 2,01,516Since tax slabs in India are0-2.5L Nil2.5L-5L 10%5L-10L 20%10L-1crore 30%above 1crore 30%+ 3%Since your taxable income is less than 2.5L, your TDS would be zero rupees.
How is the tax calculated on CTC in India?
CTC means Total Cost of an employee To The Company.Tax is not calculated on CTC as there are some payment either to government on account if employer and provision for some differed paymentGross salary figure is less than the CTC.Gross Salary = CTCLess :Employer's PF contributionEmployer's ESIC contributionProvision for payment of Gratuity at time of leaving and/or retirementGross SalaryLess : all allowable exemptionsHRA - House Rent Allowance,Medical Reimbursement,LTA/LTC Leave Travel Allowanceand such other perquisitesare deducted to arrive at taxable income and on such income, tax is calculated as per tax rates applicable for the relevant assessment year.