Agricultural income can give you tax advantage but you should know correct method for calculating tax.Learn how to calculate income tax liability when you have agricultural income.
Step 1:
Compute non agricultural income as if it was your only income.
Step 2:
Aggregate non agricultural income and agricultural income and compute tax on it.
Step 3:
Compute tax on agricultural income after adding basic exemption limit to it.
Step 4:
Step 2- Step 3 is tax payable
Step 5:
Add surcharge and education cess.
This exemption is not available to company or firm.
Don’t you think this is great benefit given to small tax payer. So follow the rule and save the tax. know more about income tax by subscribing to Tax masala’s news letter.