How to calculate income tax on salary with example: Income Tax Calculator - How to

Income Tax Calculator - How to calculate Income taxes online? for FY 2024-25 (AY 2025-26 ) and FY 2025-26 (AY 2026-27 ) with ClearTax Income Tax Calculator . Refer examples and tax slabs for easy calculation. Calculating income tax on salary involves using tax slabs, which are ranges of income that are taxed at a specific rate. For example , consider an individual earning ₹10 lakhs per annum under the new tax regime for AY 2025-26. The next 4 lakhs (7 - 3 = 4 lakhs), are taxed at 5%, resulting in a tax of 20,000 (4 lakhs x 5%). Lastly, the last 3 lakh (10 - 7 = 3 lakh) is taxed at 10%, which results in a tax of 30,000 (1 lakh x 15%). In total, the tax amount is 50,000 (20,000 + 30,000 + 50,000). With the income tax season underway, many salaried individuals are trying to understand how much tax they owe under India’s tax regime. Calculating income tax on salary involves identifying your taxable income, choosing the right regime (old or new), and applying the respective slab rates. Here’s a step-by-step breakdown with an example to make it easier. 1. Understanding Salary Components A typical salary structure includes: