Income tax calculator 2083/84

Your deductions come off the year's income first, and what is left is taxed in bands: 1% on the first Rs 10 lakh, 10% up to Rs 15 lakh, 20% up to Rs 25 lakh, 27% up to Rs 40 lakh and 29% above that. Rs 12,00,000 a year with no deductions is Rs 30,000 in tax, Rs 2,500 a month. The bands are Schedule 1 of the Income Tax Act, 2058, as amended by the Finance Act, 2083 (section 57).

The first band rose from Rs 5 lakh (Rs 6 lakh for a couple) to Rs 10 lakh and the top rate fell from 39% to 29%, and a couple is now taxed on the same bands as one person. House insurance up to Rs 10,000 (it was Rs 5,000) and a quarter of your children's school fees, up to Rs 25,000, now come off your income.

Contributions to the EPF, CIT and SSF, yours and your employer's, up to Rs 5,00,000 or a third of your income, whichever is less; life insurance up to Rs 40,000, health insurance up to Rs 20,000 and house insurance up to Rs 10,000; 25% of your children's school fees, up to Rs 25,000; Rs 10,000 to Rs 50,000 if you work in a remote area, by its category; and Rs 5,00,000 for a person with a disability.

Someone who pays into the Social Security Fund pays nothing on the first Rs 10 lakh, and neither does pension income or a registered sole proprietorship. A woman whose only income is salary gets 10% off her tax.

Your employer withholds the year's tax from your pay, usually a twelfth each month, and adjusts it when your pay changes. This is a guide to the law, not an assessment: it leaves out pension, business and investment income, the medical tax credit, and non-residents, who pay a flat 25%. Check your payslip, or ask the Inland Revenue Department.