Especially if you have no experience in finance, income tax might be perplexing. You most certainly have queries regardless of your position: salaried, freelancer, senior citizen, or company owner. We will review typical taxation queries and answers in this post to help you better grasp your taxes.
Who should submit an income tax return (ITR)?
Any person whose overall income in a financial year exceeds ₹2.5 lakh must file an ITR. Senior citizens’ limit is ₹3 lakh; super senior citizens’ limit is ₹5 lakh.
✅ Q2: On what final date should income tax returns be filed?
For those (not needing an audit), the due date is July 31st of the assessment year.
✅ Q3: Is salary income the only income subject to taxes?
A: Not exactly. Taxable income includes wages, house property (rent), capital gains (shares/property), business income, and other sources (FD interest, lottery, etc.).
✅ Q4: How can I legitimately reduce my taxes?
- Section 80C (PPF, LIC, ELSS – up to ₹1.5 lakh) among other deductions
- Section 80D – Health insurance
- Section 24(b) – Home loan interest
- Standard deduction for salaried individuals: ₹50,000
Q5: Is savings account interest taxed?
A: Yes, however, Section 80TTA allows you to deduct up to ₹10,000. The limit for senior citizens under Section 80TTB is ₹50,000.
Q6: What is the tax rate for salaried individuals?
| Income Range | Tax Rate |
| Up to ₹2.5 lakh | 0% |
| ₹2.5 lakh – ₹5 lakh | 5% |
| ₹5 lakh – ₹10 lakh | 20% |
| More than ₹10 lakh | 30% |
Income up to ₹5 lakh (no tax) is covered under Section 87A rebates.
✅ Q7: Do dividends require tax payments?
A: Yes, dividends are taxed at your income slab rate. TDS at 10% is deducted if the dividend exceeds ₹5,000.
✅ Q8: Taxation of Capital Gains:
- Short-term capital gains on shares: 15%
- Long-term capital gains (LTCG on shares): 10% above ₹1 lakh
- Property/gold (LTCG): 20% with indexation
Q9: When is TDS deducted? What is it?
Tax Deducted at Source (TDS) is tax deducted before payment. It covers dividends, rent, FD interest, and salary payments. File your ITR and then claim TDS.
✅ Q10: What happens if I neglect to file my return?
A: You might face:
- A late charge of ₹1,000 to ₹5,000
- Interest on unresolved taxes
- You may lose the ability to carry forward losses or claim refunds.
Conclusion
For most Indian taxpayers, these fundamental tax questions and answers address the most frequently asked queries. Knowing your taxes will help you stay free from worry throughout tax season, save money, and avoid penalties. If you’re ever in doubt, consult a tax professional; it’s better to be safe than sorry.
