Comparison of Income Tax Payable under IT Act and DTC

Comparison of Income Tax Payable under IT Act and DTC

Total Income, in case of assesses who is not a senior citizen or woman assessee     Rs. Tax payable under ITAct after deduction of Rs.1,00,000/- u/s. 80C                     Rs.    Tax payable under DTC without benefit of Investment as investment in eligible for deduction under EET scheme only Rs. 1,60,000/- 0 0 2,60,000/- 0 10,000/- 3,00,000/- 4,120/- 14,000/- 4,00,000/-        14,420/- 24,000/- 5,00,000/- 35,020/- 34,000/- 6,00,000/- 55,620/- 44,000/- 7,00,000/- 76,220/- 54,000/-   Tax liability under ITAct is calculated at rates for AY2010-11 i.e. Financial Year 2009-10 Tax liability under DTC is calculated at rates given in First Schedule of DTC, 2009. Thus tax liability will be more for small tax payers as it will not be beneficial for them to investment in saving scheme as the amount will be taxed when the amount is withdrawn from saving scheme. Long term capital gains on transfer of shares to be taxed @ normal rates under DTC, whereas long term capital gains on transfer of shares not taxed under ITC. This increases tax liability of assessee incase of LTG on sale of shares and it will be reduced in case of STG on sale of shares. Deduction on interest on loans taken for self-occupied property will not get any benefit as was allowed u/s24(2) of ITAct.

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