7 Replies to “I need basic knowladge for Incom tax as my salary increased but i don’t know any thing about this how to save”

  1. you can save in Life Insurance Policies, Provident Fund, Public Provident Fund, National Savings Certificates etc upto a sum of Rs. 1,00,000 and save tax. Suppose your salary is Rs.3,50,000 then if you save 1,00,000 under the above schemes then you have to deduct this amount from Rs.3,50,000 that leaves Rs.2,50,000 out of this amount you deduct Rs.1,15,000 which leaves balance of Rs.1,35,000/- that is taxable…..first 35,000 @ 10%, next 1,00,000 at 20% so you will end up paying Rs. 3,500 + Rs.20,000/- total Rs. 23,500 and on this 3% Education CessRs. 705/- add up Rs. 23,500 and Rs.705 and that is what you have to pay to IT Dept.

  2. Contact a taxpractioner ,he will help you in filing returns correctly .At least they will charge only RS 250/-OR less .Some friends will hellp you free of cost .

  3. The basic tax exemptions for this running financial year 07-08 are as follows:

    Rs.1,10,000 for HUF or Male <65 years
    Rs.1,45,000 for Femala <65 years
    Rs.1,95,000 for Seniour Citizens >65 years (Male or Female)

    Tax Slabs for FY: 07-08 are as follows:


    00% Up to 1.1 lakhs
    10% Tax between 1.1 lakhs to 1.5 lakhs
    20% Tax between 1.5 lakhs to 2.5 Lakhs
    30% tax after 2.5 lakhs


    00% Up to 1.45 lakhs
    10% Tax between 1.45 lakhs to 1.5 lakhs
    20% Tax between 1.5 lakhs to 2.5 Lakhs
    30% tax after 2.5 lakhs

    Seniour Citizens:

    00% Up to 1.95 lakhs
    20% Tax between 1.95 lakhs to 2.5 Lakhs
    30% tax after 2.5 lakhs

    Tax Savings: (under section 80C)

    All of the above can invest up to 1 lakh in tax deduction investments like LIC premium, PPF, NSC, 5 years Bank Deposit & ELSS etc. These are called 80C deductions. More clearly written in the below website.

    If you invest in the above said tax savings 80c investments, your income will be directly reduced up to a max. investment of Rs.1 lakh.

  4. I would suggest you first, check your salary break up. you will get it from your HR person. Then calculate the net taxable income if any ( there are a lot of deductions in the gross salary that may make you non taxable).

    secondly, look for a good consultant and seek advice.

    last do the cost benefit analysis on your own situation and then invest in your future.

    If you are in delhi i may offer my services.

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