Here we will learn in easy language about Income Tax for Financial Year 2017-18 (Assessment Year 2018-19) like

  • What is income Tax
  • Types of incomes Under Income Tax
  • Concept of Previous Year and Assessment Year
  • Who is Assessee
  • What is Income tax Challan
  • Income Tax Return (ITR)
  • Changes in Finance Act. (Budget)
  • Changes in ITR Dues Dates (AY 2016-17 to 2018-19)
  • How to Calculate Income Tax Slab Rate for Individuals
  • What is Gross Total income,Deductions and Net Total Income
  • Difference between Exemptions and Deductions

What is INCOME TAX

Income tax is a tax charged charged on Income earned during the year

 

Name of the Law

 Income Tax Act, 1961

 

Under Which Government

 Central Govt.

 Hence same tax applies to whole of India


Types of Income under Income Tax

 

5 HEADS OF INCOME

Income is categorized into 5 major heads:

  1. INCOME FROM SALARIES- [Salary from job]
  2. INCOME FROM HOUSE PROPERTY  -[Income from house like Rent]
  3. PROFITS AND GAINS OF BUSINESS AND PROFESSIONS  -[Business Income also called PGBP Income]
  4. INCOME FROM CAPITAL GAINS- [Profit from sale of Assets like Property]
  5. INCOME FROM OTHER SOURCES- [All other type of Income like Interest or Dividend]

Hence those income which are not falling under any other heads are taxable under Income from Other Sources

All these combine to form Gross Total Income as shown below :

Particulars Amt
Income from Salaries xx
Income from House Property xx
Profits and Gains of Business and Profession xx
Income from Capital Gains xx
Income from Other Sources xx
Gross Total Income xx

Concept of Previous Year and Assessment Year:

Current Financial Year is 2018-19

  • It starts from 1 April 2018 till 31 March 2019
  • ITR Will be filed after end of the year
  • Since ITR is filed in next year,Financial Year 2018-19 is called Assessment Year 2019-20

 

Similarly

  • Last Financial Year was 2017-18
  • It started from 1 April 2017 till 31 March 2018
  • ITR to be filed after the end of year
  • Since ITR is filed in next year,Financial Year 2017-18 is called Assessment Year 2018-19

Hence in Income Tax,Current Financial Year is called Previous Year and Assessment Year is one year ahead

Financial Year (FY) or Previous Year Assessment Year
2018-19 AY 2019-20
2017-18 AY 2018-19
2016-17 AY 2017-18
2015-16 AY 2016-17
2014-15 AY 2015-16
2013-14 AY 2014-15

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Teachoo