Income Tax Preparation software in Excel for the F.Y.2022-23

Income Tax Preparation software in Excel with Discount u/s 87A was introduced by the Government of

 India in the year 2013-14. 87A discount benefits your tax liability. Rebates under Section 87A can be

 claimed if your taxable income does not exceed the predetermined limit for the relevant financial year.

You can claim a maximum deduction of Rs 12,500 under Section 87A of the Income Tax Act for the financial year 2022-23.

The maximum reduction amount of 87A is adjusted from time to time. Initially, the maximum tax refund under Section 87A of the Income Tax Act was Rs 2,000. In the Union Budget 2016, it was increased to Rs 5,000. In the Union Budget 2017, it has been increased to Rs 2,500, for people with net taxable income up to Rs 3,50,000. After the Union Budget 2019, the government increased the net taxable income by ₹5 Lakhs. The maximum discount limit of 87A has also been increased to Rs 12,500.

What is Income Tax Rebate?

An income tax refund can simply be understood as a form of a tax refund that you receive from the tax authorities in certain circumstances. A person is liable for a tax credit if he or she pays more tax in a financial year than they have to pay to the government. To take advantage of the tax break, make sure you calculate your tax liability correctly and file your income tax return within the designated period.

What is a deduction of income tax u/s 87A?

Rebate u/s 87A provides a tax benefit to an individual taxpayer provided his total taxable income does not exceed the threshold of Rs. 5,000,000 for a particular financial year. That is, if the total taxable income exceeds Rs. 500,000, he will not be eligible for the benefit of tax relief under section 87A.

When did Section 87A come into force?

The Section 87A deduction was first offered in the year 2013 and has been in force for many years, only reinstated in 2019. According to the new provisions of Section 87A, any person with taxable annual income up to Rs 5 lakhs is eligible for an income tax refund of Rs.12,500. This actually translates into the fact that people with an annual income of less than Rs 5 lakhs are effectively exempt from income tax and can actually save income tax in India.

Section 87A- Then and Now

It is interesting to note that the income tax refund provided under Section 87A has undergone many changes since its introduction in 2013. It was only in the financial year 2018-2019 that the income tax refund provided under Section 87A ended with much less Rs. 2500. So, if your total taxable income was above Rs 3.5 lakhs and your tax liability was above Rs 2,500, Section 87A could no longer be a tax relief target for you.

How can you claim a tax refund under Section 87A?

Under Income Tax Section 87A, you can claim a refund of Rs 12,500 from your tax liability. Here are the steps to claim this 87A reduction:

Step 1. First, calculate your gross total income for the previous financial year

Step 2. Subtract from this any deductions you claimed for tax-saving investments

Step 3. Now you arrive at your Gross Total Income after taxes. This is your taxable income for the fiscal year (or previous year) .

Step 4. Estimates your gross tax liability on any income, but does not add any deductions to that amount

Step 5. You can claim an 87A reduction on your gross tax liability prior to delivery and arrive at the net tax liability.

Feature of this Excel Utility:-

1) This Excel utility prepares and calculates your income tax as per the New Section 115 BAC (New and Old Tax Regime)

2) This Excel Utility has an option where you can choose your option as New or Old Tax Regime

3) This Excel Utility has a unique Salary Structure for Government and Non-Government employees Salary Structure.

4) Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E from the F.Y.2000-01 to F.Y.2022-23 (Update Version)

5) Automated Income Tax Revised Form 16 Part A&B for the F.Y.2022-23

6) Automated Income Tax Revised Form 16 Part B for the F.Y.2022-23