Can Using the Tax Calculator Bring Joy in Taxation?

The history of tax dates back to the times of the Babylonians. All the documents, scrolls and scripts suggest that the tax system was invented by the Babylonians roughly around 2500 B.C., and it has been an integral part of our lives since then. Taxation system has evolved significantly over the years. The earliest records of tax evasion dates back to 1900 B.C., where a person was imprisoned for smuggling goods. Hence, proper taxation is not a modern-day problem but has been there since the time we know about tax.

Tax Calculator is a modern masterpiece and breakthrough technology in the realm of finance that has made it possible to commence a transparent and judicious taxation system. This online tool acts as the guiding light in tax planning, and helps the assessee (tax payer) to save plentiful on his tax liability.

Progression of Tax

From 2500 B.C. to date, the taxation system has seen many moderations, alterations and adjustments to fit in the prevailing society. In the earliest days, tax was honoured in barter that mostly involved sheep, goats and grain as currency. Later on, the government emphasised on partial barter, and today we have the absolute monetary system to satisfy our tax dues.

As later as 167 B.C., the Romans had invented numerous ways of charging tax from the public. This included property tax, especially on land, which made up to the most part of the tax revenue for the government. Also, Poll taxes – the tax levied on an adult irrespective of his/her income – besides ordinary taxes like customs and sales tax, was a common revenue alternative for the government. There has also been times where inheritance tax to the tune of 5% was charged on a person’s property, if they didn’t make any legal heir to their property.

The Modern Day Taxation

In India, where there are more than 1.3 billion living souls, the number of taxpayers is surprisingly low. While there could be many reasons to this situation, high tax rates and lack of knowledge about tax abatement measures can be cited as the major culprits. A normal person who is under the age of 60 gets freedom from tax up to an annual income of ₹2, 50, 000. In case the income exceeds, tax is charged progressively with the increase in income.

The online Tax Calculator can act as a great source in computing the annual tax liability. If you know your income and expenses and any deductions that you are entitle for, then you can have your computation done within seconds. Just feed this online machine the information and you’ll be served with the most accurate answers in no time.

The Relaxation in Taxation

Though it is difficult to assume that most people pay their dues honestly and in time, there are certain measures that can inspire them to honour the needful. Section 80C of the Income Tax Act, 1961 have certain areas marked where you can invest and earn the benefit of deductions from your total taxable income. This in turn will cut down your tax liability and you’ll be able to save a good amount on your tax bill, every year.

As per Section 80C, an assessee can avail a maximum deduction of up to ₹1,50,000 from his taxable income. If availed in full, this can lead to a massive saving in taxes that can sum up to ₹46,800. Here, the assistance of the Tax Planner can be taken as it will depict clearly how much you owe to the authorities, on the condition that you know your figures. To use this tool, you shall have worked out the following things: -

• Citizenship Status – Ordinary citizen, senior citizen or super senior citizen

• Residential Status – Resident, non-resident or not ordinary resident

• Annual Income

• Deductions Available under Section 80C

Hence, once you are done feeding the above details into the Tax Returns Calculator, you’ll have the most accurate results about your tax liability in front of you in no time. If used correctly, this online tool can make you a happy tax payer, by letting you pay only what you owe and not a dime extra.