Types Of Taxes In India

It’s a well-known fact that every citizen of a respective country, with the exception of a few, should pay a certain amount of income tax. There are different types of taxes for different incomes. However, now everyone is aware of these various taxes and how they are applicable. This article will give you an insight on the different types of taxes and how they are applicable. 

1.    Personal income tax – this type of tax is better known as a tax that is paid for the income drawn by an individual through any source like salary or income got through dividends or interest. This is a progressive tax which means the higher your income the more tax you pay.

2.    Corporate Income Tax – this type of tax is applicable to those running companies and having income through them. Individuals that receive dividends from these companies will have to pay taxes on the received dividends. However, most tax payers feel that the double taxation is very unfair.

3.    Capital Gain Tax – this is subject to the loss or income that you suffer from investment in goods or property. The tax is determined depending on whether the capital gains are short term or long term. These types of gains are got from any investment that has lasted for a year or more.

4.    Medicare and Social Security Tax – this tax is mandatory according to the various government Acts. However, individuals who have been employed by respective employers will pay half of this while the employer pays the other half. Social security tax is taxable only after your salary reaches a certain high level.

5.    Tax on self-employment – for those who are self-employed, they are liable to pay the entire Medicare and social security taxes according to the income each year. There are two types of taxes that an individual pays. The first part is charged according to your yearly income while the second part is merged with your personal income tax and paid with taxable income charges.

Income tax filing is mandatory and should never be neglected. You have many options of filing tax online which is very easy and safe. You can follow the simple guidelines offered online or even make use of the customer care support online when filing you tax returns. Take time off from your busy schedules every quarter, half or once a year to file your taxes and live a happy life.

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