My Life, My Decisions
                                                 (A Life Time Decision)

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The future depends on how we plan the present.If the planning and decisions are right, the future is definitely good.              ...A renowned Economist.

Tax Computation for Self Employed/Professional Class:



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      People in this category are fully responsible for their tax computation and filing of Income       tax return well in time. A self-employed person can enjoy the tax efficiency benefit by at        least 15% as against similar salary income. Some tips:



The documents required are by and large the same. These are:

Example- Tax Calculation

Computation of Taxable Income
Description Break-up Amount
INCOME FROM PROFESSION
Income 5,00,000 x 12 60,00,000
INCOME FROM OTHER SOURCES
Saving A/c Interest- All Banks 50,000
FDR Interest- All Banks 1,50,000
GROSS TOTAL INCOME 63,00,000
EXPENSES
Office Expenses
Communication & Computers etc. 50,000
Staff Salary 24,00,000
Office Rent 9,00,000
Miscellaneous Expenses 6,00,000
Sub Total: 39,50,000
Less: Deduction under Chapter VI-A
Deduction u/s 80C
LIC,PPF, NSC, ULIP, Post Office etc. 1,50,000 1,50,000
Home Loan -EMI etc. 3,60,000 3,60,000
U/S 80D (Payment of Medical Insurance Premium ) 40,000 40,000
Sub Total: 45,00,000
NET INCOME 18,00,000

(A)--- Tax Due (18,00,000-2,50,000)*.3 46,500
(B)--- Education Cess( 3%) 1395
(C)--- Tax Payable (A+B) 47,895
(D)--- TDS Deducted (if any) 0
NET TAX PAYABLE (C-D) 47,895


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