Tax concessions are taxes forgiven by the government. As per the rules, if the annual income of a person is up to Rs.7 lakh. then his income tax liability is forgiven
New Delhi : A salaried or self-employed person has to pay income tax if he earns more than a certain income. If you are earning up to Rs 7 lakh, then there is income tax relief for you. Although these rules are very simple, many people get confused. So first know what is income tax exemption and who all are eligible for it. If your income is more than 7 lakhs then you will not get this exemption under section 87A. This clearly means that not everyone gets this exemption.
What is income tax exemption?
Tax concessions are taxes forgiven by the government. As per the rules, if the annual income of a person is up to Rs.7 lakh. Then his income tax liability is waived off. As a result of this decision, no tax will be payable on income up to Rs 7 lakh. Because this income comes under the category of tax exemption. That’s why the government forgives him.
Who gets tax relief?
Bonafide Hindu Undivided Families (HUFs) cannot avail of this exemption. Also, to avail the exemption, you need to be a resident as per the Income Tax Act. Because, non-residents also do not get its benefit. Also, your taxable income should not exceed 7 lakhs.
How to get tax exemption on income up to 7 lakhs?
Suppose there is a 5 percent tax slab for income between 3 to 6 lakhs, then the income tax on taxable income of 5 lakhs will be Rs 12,500. But if you take advantage of various savings schemes and exemptions, then this tax is waived off.
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