Basic Tax Terms To Know For Filling Income Tax

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Understanding basic tax terms like income, deductions, and tax brackets is crucial for filing your return. Let's know what these terms mean. 

1

Gross Total Income

This is the total of all your income from various sources before claiming any deductions or exemptions.

2

Net Taxable Income

This is the income on which you pay tax, it is calculated by subtracting deductions allowed under the Income Tax Act from your Gross Total Income.

3

Income Tax Return

This is the form you file with the Income Tax Department to report your income earned during the previous year.

4

Assessment Year

The Assessment Year is the year in which the income tax is assessed. It starts on April 1st and ends on March 31st of the following year.

5

Previous Year

The Previous Year is the financial year for which the income tax return is being filed, it is the year preceding the Assessment Year.

6

Tax Deducted at Source

TDS is paid in advance against your income tax liability. You can claim credit for the TDS deducted while filing your income tax return.

7

Tax Slabs

The Income Tax Act prescribes different tax rates for different income brackets, these brackets are known as tax slabs.