Calculation of Tax

The calculation is different even though agricultural income is exempted, it is considered for purpose of tax slab if the income exceeds the amount not chargeable to Tax. Tax has to be calculated on the total amount of income and proptionately the tax on account of addition of agricultural income should be deducted from the total tax.

Method of Tax Calulation on Agriculture Income A Y 2009-10- of Mr Nitin

1. Check whether your Income from all the 5 heads of Income is above the taxable limit  for male it is 150000/  

2 Ans.- Yes- then proceed for further calculation. Ans. No then stop here no calculation is reqd as tax is nil on the Taxable Income.

 3. Taxable Income or Total Income is ....Say ... Rs 350000/ and Ag. Income is Rs 100000/

4  Total Income                        350000/

     Add: Net Ag Income            100000/

5 Total Income for Rate Purpose           Rs  450000

 Statement of Tax 

Tax on Total Income fro Rate Purpose   i.e Rs  450000/           45000/         (15000+30000)  

Less Tax on Agriculture Income (Basic Limit +Ag Income)       25000/    

                          (150000+100000=250000)                              -----------------

Net Tax Payable                                                                                  20000/

Add: 3% Secondary+Hi. Sec. Ed Cess                                               600/