This document provides examples for computing tax liability in India based on different sources of income. It gives the total income, taxable income and tax payable calculations for 4 scenarios involving income from salary, house property, business, capital gains, other sources, and casual income like lottery or betting winnings. Tax is calculated by applying the appropriate tax rates to income slabs and adjusting any losses from capital gains against other sources as per income tax rules.

1. Computation of Tax liability
Dr. P. Ravichandran
M.Com., M.B.A., M.A (Astrology)., M.Phil., Ph.D.,
D.C.P., D.L.L & A.L., P.G.D.C.A., P.G.D.P.M & I.R.,
S.B.K. College, Aruppukottai – 626101.
 9443424090 & 9080030090
 e-mail id.- prcapk@gmail.com

2. Computation of Tax liability
1. Income from salary ₹ 4,00,000
2. Income from house property ₹ 2,00,000
3. Income from business ₹ 3,00,000
4. Income from capital gains
– Short term capital gains ₹ 1,50,000
– Long term capital gains ₹ 1,00,000
5. Income from other sources
- Interest on investments ₹ 20,000
- Winnings from lottery ₹ 2,00,000
Total income = ₹ 13,70,000

3. Total income ₹ 13,70,000
1. On Casual income ₹ 2,00,000 @ 30% = 60,000
2. On LTCG ₹ 1,00,000 @ 20% = 20,000
3. On Balance of income ₹ 10,70,000
First ₹ 2,50,000 Nil -
Next ₹ 2,50,000 @ 5% 12,500
Next ₹ 5,00,000 @ 20% 1,00,000
Balance ₹ 70,000 @ 30% 21,000 1,33,500
Income Tax 2, 13,500
Add: Education Cess @ 3% 6,405
Tax Liability 2, 27,135
Tax Payable = ₹ 2,27,140

4.  Income from salary ₹ 2,00,000
 Income from LTCG ₹ 1,00,000
 Winnings from TV shows ₹ 1,00,000
 Total income = ₹ 4,00,000
 On Casual income ₹ 1,00,000 @ 30% 30,000
 On LTCG 1,00,000
- Deficit 50,000 50,000 @ 20% 10,000
 On Balance ₹ 2,00,000
 Exemption limit 2,50,000 Nil
Difference ₹ 50,000 adjusted from LTCG
Income Tax 40,000
Add: EC @ 3% 1,200
Tax Liability 38,800

5.  Income from salary ₹ 2,00,000
 Winnings from Betting ₹ 1,00,000
 Total income = ₹ 3,00,000
 On Casual income ₹ 1,00,000 @ 30% 30,000
 On Balance ₹ 2,00,000
 Exemption limit 2,50,000 Nil
Difference ₹ 50,000 can’t be adjusted
from casual income
Income Tax 30,000
Less: Rebate u/s 87A (if TI ≤ 5,00,000) 2,500
27,500
Add: EC @ 3% 825
Tax Liability 26,675

6.  Income from salary ₹ 2,00,000
 Income from LTCG ₹ 25,000
 Winnings from Card games ₹ 1,00,000
 Total income = ₹ 4,00,000
 On Casual income ₹ 1,00,000 @ 30% 30,000
 On LTCG 25,000
- Deficit 25,000 Nil
 On Balance ₹ 2,00,000
 Exemption limit 2,50,000 Nil
Difference ₹ 50,000 adjusted from LTCG only
Income Tax 30,000
Add: EC @ 3% 900
Tax Liability 29,100