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Pay Income Tax Online

E Governance - Thursday, July 14, 2011 10:24:35 AM

How to pay income tax online-There are several advantages of paying your income tax online. So go through below website link and full fill the guideline and pay your tax online.

http://www.incometaxindia.gov.in
http://www.tin-nsdl.com/
https://www.onlinesbm.com/tax_retail.html
http://www.taxindiaonline.com/RC2/index.php3
http://www.icicibank.com/Personal-Banking/onlineservice/online-services/online-tax-payment/onlinetax.html

Income tax in India
The government of India imposes an income tax on taxable income of individuals, Hindu Undivided Families (HUFs), companies, firms, co-operative societies and trusts (identified as body of individuals and association of persons) and any other artificial person. Levy of tax is separate on each of the persons. The levy is governed by the Indian Income Tax Act, 1961. The Indian Income Tax Department is governed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue under the Ministry of Finance, Govt. of India. There were 33 million income taxpayers in 2008.

Charge to Income-tax
Every Person whose total income exceeds the maximum amount which is not chargeable to the income tax is an assesses, and shall be chargeable to the income tax at the rate or rates prescribed under the finance act for the relevant assessment year, shall be determined on basis of his residential status.
Income tax is a tax payable, at the rate enacted by the Union Budget (Finance Act) for every Assessment Year, on the Total Income earned in the Previous Year by every Person.
The changeability is based on nature of income, i.e., whether it is revenue or capital. The principles of taxation of income are-:

Income Tax Rates/Slabs Rate (%) for men:

Up to 1,80,000 = NIL ,
1,80,001 – 5,00,000 = 10%,
5,00,001 – 8,00,000 = 20%,
8,00,001 upwards = 30%,
Up to 1,90,000 (for resident women)= NIL,
Up to 2,50,000 (for resident individual of 60 years or above)= 0,
Up to 5,00,000 (for very senior citizen of 80 years or above)= 0.

Heads of Income: Individual Heads of Income

Income from Salary
All income received as salary under Employer-Employee relationship is taxed under this head. Employers must withhold tax compulsorily, if income exceeds minimum exemption limit, as Tax Deducted at Source (TDS), and provide their employees with a Form 16 which shows the tax deductions and net paid income. In addition, the Form 16 will contain any other deductions provided from salary such as:

Medical reimbursement: Up to Rs. 15,000 per year is tax free if supported by bills.
Conveyance allowance: Up to Rs. 800 per month (Rs. 9,600 per year) is tax free if provided as conveyance allowance. No bills are required for this amount.
Professional taxes: Most states tax employment on a per-professional basis, usually a slabbed amount based on gross income. Such taxes paid are deductible from income tax.
House rent allowance: the least of the following is available as deduction-1.Actual HRA received, 2. 50%/40%(metro/non-metro) of basic 'salary', 3. Rent paid minus 10% of 'salary'. Basic Salary for this purpose is basic+DA forming part+commission on sale on fixed rate.

Income from Business or Profession

carry forward of losses
he uses a computer,
he travels to sites in his car,
he has a peon to help him collect payments
He has a maid who comes in daily
part of the society maintenance bills
Entertainment expenses incurred..
Books and magazines for his professional practice.

The income referred to in section 28, i.e, and the incomes chargeable as "Income from Business or Profession" shall be computed in accordance with the provisions contained in sections 30 to 43D. However, there are few more sections under this Chapter, viz., Sections 44 to 44DA (except sections 44AA, 44AB & 44C), which contain the computation completely within itself. Section 44C is a disallowance provision in the case non-residents. Section 44AA deals with maintenance of books and section 44AB deals with audit of accounts.
In summary, the sections relating to computation of business income can be grouped as under: -

Deductible Expenses - Sections 30 to 38 [except 37(2)].
Inadmissible Expenses - Sections 37(2), 40, 40A, 43B & 44-C.
Deemed Incomes - Sections 33AB, 33ABA, 33AC, 35A, 35ABB & 41.
Special Provisions - Sections 42 & 43D
Self-Coded Computations - Sections 44, 44A, 44AD, 44AE, 44AF, 44B, 44BB, 44BBA, 44BBB, 44-D & 44-DA.

Income from Capital Gains
Transfer of capital assets results in capital gains. A Capital asset is defined under section 2(14) of the I.T. Act, 1961 as property of any kind held by an assessee such as real estate, equity shares, bonds, jewellery, paintings, art etc. but does not include some items like any stock-in-trade for businesses and personal effects. Transfer has been defined under section 2(47) to include sale, exchange, relinquishment of asset, extinguishment of rights in an asset, etc. Certain transactions are not regarded as 'Transfer' under section 47.
For tax purposes, there are two types of capital assets: Long term and short term. Long term asset are held by a person for three years except in case of shares or mutual funds which becomes long term just after one year of holding. Sale of such long term assets gives rise to long term capital gains. There are different scheme of taxation of long term capital gains. These are:

As per Section 10(38) of Income Tax Act, 1961 long term capital gains on shares or securities or mutual funds on which Securities Transaction Tax (STT) has been deducted and paid, no tax is payable. STT has been applied on all stock market transactions since October 2004 but does not apply to off-market transactions and company buybacks; therefore, the higher capital gains taxes will apply to such transactions where STT is not paid.
In case of other shares and securities, person has an option to either index costs to inflation and pay 20% of indexed gains, or pay 10% of non indexed gains. The indexation rates are released by the I-T department each year.
In case of all other long term capital gains, indexation benefit is available and tax rate is 20%.

Income from Other Sources
This is a residual head; under this head income which does not meet criteria to go to other heads is taxed. There are also some specific incomes which are to be taxed under this head.

Income by way of Dividends
Income from horse races
Income from winning bull races
Any amount received from key man insurance policy as donation.
Income from shares (dividend otherthan indian company)

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