Income Tax Slab
An Income Tax Slab is a document that outlines income tax rates corresponding to various taxable income brackets.
In numerous countries, individual taxpayers are subject to income tax based on a slab system, where distinct tax rates are designated for different income brackets. These tax rates typically rise with an increase in the income bracket.
Within BizCentric HR, you can establish multiple Income Tax Slabs and associate them with individual employee salary structures through Salary Structure Assignment.
To access Income Tax Slab, go to: > Home > Human Resources > Payroll > Income Tax Slab
1. How to create an Income Tax Slab
To create a new Income Tax Slab:
- Enter a Name for the IT Slab, Company and the date from which it will be Effective From.
- Enable the checkbox ‘Allow Tax Exemption’ if applicable.
- Save and Submit.
2. Features
2.1 Tax Slabs
In the Tax Slab table, you can define the rate for different income slabs. To define slab, From Amount and To Amount should be entered. For the first slab, From Amount is optional and for the last slab, To Amount is optional. Both the amount is inclusive while evaluating tax based on taxable income.
The tax slab can be applicable based on specific conditions. Conditions can be written using all field names of Employee, Salary Structure, Salary Structure Assignment, and Salary Slip documents.
2.2 Other Taxes and Charges on Income Tax
If other taxes are applicable on calculated income tax, you can enter those using this table. You can also define the min and max taxable amount for which this tax will be applicable.
2.3 Other Properties
- Enable Tax Exemptions: Tax exemptions can be permitted for a particular Income Tax Slab. When activated, Employee Tax Exemption Declaration and Proof Submission are taken into account when calculating taxable income based on this tax slab.
- Standard Tax Exemption Amount: If exemptions are permitted, the government-defined Standard Tax Exemption Amount can be inputted here. This exemption typically does not necessitate any document proof and applies to all employees associated with this income tax slab.