Financial planning remains the most important part of income management. It helps you precisely determine your short- and long-term life goals and balance your income accordingly. However, tax liabilities and obligations are the most critical factors that can influence your financial planning.
That’s why you should use an
income tax calculator to get an idea of the amount of money that you are most likely to pay as tax. The tax and
EMI calculators can help you simplify your tax calculations and financial spending. This way, you’ll be able to make the best out of your income.
Join us as we sail through the significance of income tax calculators in financial planning and discover the factors that affect your tax obligations!
Role of Income Tax Calculator in Simplifying Financial Planning
Figuring out tax liabilities for financial planning is a daunting task. The majority of people fail to determine their income tax accurately, and as a result, they end up with faulty financial planning. That’s when the income tax calculator comes to the rescue. Here are some of the ways in which tax and EMI calculators can simplify your financial planning.
• Updated With Revised Tax Regimes
Online income tax calculators are constantly updated with revised tax regimes and provide valuable insights about tax obligations, which makes them an essential component of your financial toolkit. Using the tax and
EMI calculator to calculate your tax liabilities will save you time that you would otherwise have wasted on manually optimising your tax according to the new regime.
• Affordable and More Convenient Than Tax Consultant
The fees of a tax consultant can burn a hole in your pocket. On the other hand, online IT calculators are available for free and can help you save money. These calculators not only provide accurate results but also save you a lot of time and effort from manually calculating and optimising your income tax.
• End-to-End Encrypted Data
Another benefit of using income tax calculators is that they secure your critical information with advanced encryption technology. This means no unauthorised personnel can access your personal and financial information. These calculators are equipped to protect your data from hackers, and they successfully shield your personal information during a data breach.
• Facilitates Informed Financial Planning
Having prior information on your tax liabilities facilitates financial planning without stressing your budget and compromising on your lifestyle. This farsightedness can help you plan your investment and make a rough estimation of how much savings you are most likely to make during a financial year.
• Helps in Calculating Total Deductions
You can use the advanced online income tax and EMI calculator to get an estimation of your HRA and standard deduction amounts. For accurate results, you’ll need to mention the incomes generated through other sources like rental income, deposits, and capital gains.
What are the Factors That Affect Your Taxes?
Multiple factors can influence the amount of income tax that you are required to pay to the government. Here’s a quick sneak peek into the factors that decide how much tax you are obliged to file!
1. Your residential status is the first thing that directly impacts your taxes. People who qualify as Residents and ordinary residents are subjected to taxes on global income. In contrast, those who qualify as Residents but are not ordinary residents only pay taxes on income sourced from India.
2. Another deciding factor is the source of your income. For instance, a salaried person will pay taxes within slabs, whereas business people will file taxes on the profits made.
3. Deductions like the House Rent Allowance (HRA) and Leave Travel Allowance (LTA) play an important role in reducing a person's overall taxable income.
4. The investments you make for future savings can also help you save taxes and ultimately affect your overall tax liability.
5. Surcharge and CESS are other essential factors that determine your taxes. High earners need to pay more taxes due to surcharges
How Can ACKO Simplify It?
One cannot deny the role of income tax calculators in streamlining financial planning. Reputed online income tax and EMI calculators like ACKO can help you determine your tax liabilities with their advanced features. Using ACKO eliminates the scope of mistakes in tax calculation because their software is up-to-date with the latest tax regime. It’s high time you consider using the ACKO income tax calculator for your financial planning.
