How do you manage Income Tax?

by saranicole10124
by saranicole10124

The first three months of the year are crucial for those who fall in the tax bracket. Taxes are one of the most crucial ways the government can earn revenue. The government taxes the public according to their income annually.

If you fall under the tax bracket, you will need to ensure that this payment is done well in time. When it comes to income tax, there is a level of ambiguity involved. Thus, if you are unsure on how to handle follow this guide.

What is income tax?

This is a tax that is levied on individuals or entities, based on their income levels or profits. There are multiple tax brackets allotted for income groups. Depending on your annual income, you will fall under a particular tax bracket.

How do you save income tax?

Given that the tax is a payment that needs to go out, income tax savings is equally important. For example, one of the best ways to save taxes is on insurance. Most insurances come under the Income Tax Act of 1961. This act states various sections under which you can save taxes such as Section 80C, 80D, 80CCC, 80CCD, 10D etc. If you take up a medical insurance, then under Section 80D you will receive deductions on your premium amount.

How do you make income tax payments?

Now for those unavoidable payments, there is a process to follow. It is important that you follow the tax payment process to ensure your money is properly deposited.

  • Go to the Tax information network of the Income Tax Act and select Challan 280.
  • Select INCOME TAX
  • Choose the correct assessment year, currently we are in year AY 18-19.
  • Once that is done go ahead and select “SELF ASSESSMENT TAX” if you are making your payments after the financial year has ended.
  • Make the payment
  • Double check the information
  • Print the receipt for future reference.

Once you have paid your taxes you have not only helped the government gain revenue, but also abided by the strict laws regarding tax defaulting.