Basic Concepts of Income Tax updated with recent amendments
Introduction The term income refers to the earnings or profits made by the individual or enterprise during a period. However, Income tax is a tax that is imposed on an individual or entity according to the profits and income earned by them. The individuals or entities are termed as "taxpayers" while the income and profits are known as "taxable incomes" . Generally, there are two types of tax: "Direct Tax" and "Indirect Tax" . Income can be generated by these five categories - Salary Income Rental Income Income from Business and Profession Capital Gains Income Income from other sources Additionally, the central government introduced the GST (Goods and Services Tax) in 2017. And it was introduced to consolidate a few taxes in one blanket. Similarly, Deduction is a term that is commonly used while filing returns or calculating taxability. It is the amount that the income tax department allows you to reduce from your income to b