Income Tax
Income Tax
Income tax is a direct tax imposed by the Indian government on the earnings of individuals, businesses, and various entities. It is governed by the Income Tax Act of 1961. This tax is calculated based on the income accrued during a financial year, which runs from April 1st to March 31st.
This tax applies to the income generated by individuals, encompassing salaries, business earnings, capital gains, and income from other sources like interest and dividends.
Companies and corporations in India are taxed on their profits. The corporate tax rate differs based on the company’s size and its revenue.
Self-employed individuals or professionals are required to pay tax on their business income under the Income Tax Act, taking into account any applicable deductions.
This tax is levied on the profit made from selling capital assets, including real estate, stocks, and bonds.
Besides income tax, there are additional taxes such as the Goods and Services Tax (GST) that apply to business activities, but income tax remains the main direct tax.
