Exe:3 CALCULATION OF INCOME TAX
Date:7/2/20
AIM:
To calculate the income tax to be paid by an individual in India for the financial
year 2019-2020.
PROCEDURE:
Step1: Open the salary details and enter the details of the employee Pan No.
department, designation, D.O.B.
Step2: Assume the basic pay as Rs.30,000 for all the 12 months starting from
April 2019.
Step3: Assume the dearness Allowance of Rs.2,000 per month.
Step4: Assume the house rent allowance receives as Rs.5,000 per month.
Step5: Assume special allowance of Rs.2000 per month.
Step6: Calculate the sum of all the components in the columns with total.
Step7: Calculate the total gross salary using ‘SUM’ function.
Step8: Assume an arrear amount of Rs.20,000 other remuneration of Rs.10,000
and add the figure along with the total gross salary.
Step9: Go to the working sheet and enter all the personal details.
Step10: Link the gross income with all allowances from the sheet ‘Salary
details’.
Step11: Based on the details asked for in the ‘working sheet’ fill up the columns
(all incomes and expenses)
Step12: Calculate the total tax payable based on the taxable incomes.
Step13: Add education and health cess (4% of tax)
Step14: Find the total tax amount to be paid
CALCULATION:
Step1: The value of Gross Annual Income is been linked with the ‘Salary details’
Step2: The value of Basic Pay and Dearness Allowance is been linked with ‘Salary
details’. Then calculate (40% of both basic and dearness allowance).
To find the value of rent paid, assume rent paid, assume rent of Rs. 15000
per month. Then calculate [ Rent paid – 10% of both basic and dearness
allowance]. HRA is linked with ‘salary details’. The minimum of above 3 is
expected.
Step3: Assume other exempted receipts / allowances at “0”
Step4: Assume professional tax as Rs. 2350
Step5: The value of salary after deduction allowances u/s 10 is calculated by E18 =
[ E8-E14-E13-E16-E17]
Step6: To calculate interest received from investments.
Assume bank amount as Rs. 1000
Assume N.S.C and Post Office M.1.S as ‘0’
Assume post office recurring deposit as Rs. 10000
Assume any other income as Rs. 20000 and Rs. 10000
Assume home loan interest paid as Rs. 100000
Step7: Assume home loan interest paid as Rs.100000
Assume loss from house property as ‘0’
Assume additional tax exemption as ‘0’
Assume interest paid as’0’
Gross Total income is calculated by E34=E28-D30
Step8: Assume value of EPF and VPF as Rs.50000
Assume PPF as Rs.20000
Assume senior citizen saving scheme as ‘0’
Assume N.S.C as Rs.’0’
Assume tax saving Fixed deposit as Rs.30000
Assume tax saving bond as Rs.10000
Assume E.L.S.S as Rs.’0’
Assume Life Insurance Premium as Rs.200000
Assume NPS as ‘0’
Assume pension plan as ‘0’
Assume 80CCD as ‘0’
Assume housing plan (Principle Repayment) at Rs.150000
Assume Sukanya Samriddhi account as ‘0’
Assume stamp duty and registration as ‘0’
Assume tution fees as ‘0’
Step9: Total deduction under 80CC, 80CCC, 80CCD is Rs.150000 (Maximum)
Step10: Assume additional deduction under 80CCDNPS as Rss.25000
Step11: Assume deduction under RGESS as ’0’
Step12: Income after deduction under 80CC, 80CCC and 80CCD [E54=E34-
SUM(E51:E53)]
Step13: Assume 80D medical insurance (self) as Rs.20000
Assume 80D medical insurance (parent) as Rs.20000
Assume 80E Interest paid as’0’
Assume 80DD medical treatment as ‘0’
Assume 80DDB Expenditure as’0’
Assume 80G, 80GGA, 80GGc as Rs.3000
Assume 80GG as Rs.0
Assume 80U for physically disable as’0’
Assume 80TTA as ‘0’
Total income (E65=E54-D56-D57-D58-D59-D60-D61-D62-D63-D64)
Step14: Calculate tax payable( E67=E65*5/100)
Assume tax rebate as Rs.12500
Total tax payable (E69=E67-E68)
Step15: Assume education cess+ Health cess at 4% (E71=E69*4/100)
Step16: Net tax payable is calculated as (E72=E69+E71)
Steo17: Assume Advance tax paid as ’0’
Step18: Tax remaining to be paid (E74=E72-E73)
RESULT:
Thus the calculation of income tax for the assessment year 2019-2020 has been calculated.
