Income Tax Rates, Income Tax Calculator, Income Tax Forms, Income Tax Refund

Income Tax

Income taxes or taxes levied on the income of an individual or any legal entity have been there for hundreds of years. They are a form of direct taxes. Income taxes can be classified as progressive, regressive or proportional and can be broadly divided into individual or personal income tax and corporate income taxes.The rationale of an income tax was mainly to garner up resources or wealth for a government or polity as a part of a ‘tribute’ or ‘tithe’ paid by the citizens. The tax on ones own personal income or income taxes collected by the government was later understood to be an integral part to raise resources for the government to carry out various developmental, infrastructural and nation building activities.In the Indian context, all income except agricultural income is treated as taxable income under the Income Tax Act of 1961. Income tax is administered by the Central Board of Direct Taxes, Income Tax Department, Department of Revenue, Ministry of Finance under the Government of India. According to the rules, every “assessee” having income above the “exemption limit” is taxable according to the rates charged by central government in line with the Finance Act regulations.

Income Tax Department has launched the Electronic Furnishing of Return of Income Scheme, under which eligible assesses can file their returns of income electronically through persons authorised to act as e-return intermediaries. The intermediaries will digitise the data of such returns, and transmit the same electronically to the e-filing server of Income Tax Department under their digital signatures. An eligible person opting to file his return of income under this Scheme shall approach and give his consent to any one of the e-intermediaries to act as his agent for the purpose of furnishing his e-return for the relevant assessment year.

Some of the other Tax Rates adopted by the governments of different countries across the world include the pay-as-you-go tax on personal income imposed by the Australian Taxation Office, a flat tax on business income and property tax limited to realized potential gains. France adopts a progressive income tax regime where personal income tax is charged at 16% of tax revenue and corporate tax at 12% of tax revenue. Sweden has a taxation system which includes a direct tax paid by the employee with an indirect tax paid by the employer. While the UK also has a progressive tax regime with 20% of tax on direct or earned income from a trade or profession, 32.5% on UK dividends and 40% on other sources of income, the USA imposes taxes in the case of an income event that is the receipt of wages or the realization of capital gains. Some of the countries that do not impose income taxes include Andorra, Bahamas, Saudi Arabia, Bahrain and Uruguay.The main problem with administration of income taxes, especially in the less developed economies is its implementation. With so many people below the poverty line a majority of the population does not come under the tax net. The general informal nature of the economy also does not allow economists and statisticians to formulate detailed statistics on the specific amount of tax collections. It is also not possible to say what changes will be brought about by minute alterations in the tax rates.
According to the Budget Announcement of 2007-08, Personal Income Tax Rates were unchanged but the threshold limit was increased to Rs. 1,10,000. Maximum amount of deduction in respect of medical insurance premium was raised to Rs. 15,000 Corporate Income Tax Rates were also unchanged and surcharge on all firms and companies with a taxable income of Rs. 1 crore or less was also removed. There were also various tax holiday schemes announced with undertakings in Jammu and Kashmir given exemptions up tom March 31st, 2012. Employees Stock Option Plan was also propsed to be brought under the Fringe Benefit Tax . The highest tax bracket is 30% with business income taxed at a flat rate of 33% for Indian Companies and 40% for foreign companies.

Tax Payments

Depreciation may be taken on passenger cars,e quipment used for entertainment or recreational urposes (i.e., photographic equipment, cell phoe s and computers), as long as these items are us ed solely for the business.