1. What is Income Tax and Professional Tax?

Income Tax is a direct tax levied by the Government of India on income earned. Professional Tax is a state-level tax on employment levied by state governments in India.

2. How Does the Calculator Work?

The calculator uses current Indian tax slabs and professional tax rates:

Where:

• Income Tax — Calculated based on FY 2023-24 slab rates with standard deduction
• Professional Tax — Varies by state, typically ₹200-250 per month

Explanation: The calculator first applies standard deduction, then calculates tax based on applicable slab rates for the selected age group.

3. Importance of Tax Calculation

Details: Accurate tax calculation helps in financial planning, ensuring compliance with tax laws, and avoiding penalties for underpayment.

4. Using the Calculator

Tips: Enter your gross annual salary, select your age group and state of employment. The calculator will show your estimated tax liability.

5. Frequently Asked Questions (FAQ)

Q1: What is the standard deduction?
A: For FY 2023-24, a standard deduction of ₹50,000 is available to all salaried individuals.

Q2: Are there any tax rebates?
A: Under Section 87A, individuals with taxable income up to ₹5 lakh can claim rebate up to ₹12,500.

Q3: Which states have professional tax?
A: Most Indian states have professional tax except Andaman & Nicobar, Arunachal Pradesh, and few others.

Q4: Can I claim HRA exemption with this calculator?
A: This calculator provides basic tax estimation. For accurate calculation including HRA, LTA, and other deductions, consult a tax professional.

Q5: When is professional tax deducted?
A: Typically deducted monthly by employer and paid to state government, with annual ceiling of ₹2,500.