We read your photo as:
The monthly salary of an unmarried person is 66,000. He monthly deposited 10% of his salary in Investment Trust (CIT) and pays Rs 350,000 annually for insurance premium. According to tax rate giv
Business/Management
ScanSolve AI Answer
Step-by-step solution
7 steps2. The monthly salary of an unmarried person is 66,000. He monthly deposited 10% of his salary in Investment Trust (CIT) and pays Rs 350,000 annually for insurance premium. According to tax rate given below, answer the following question.
- a) How much is his total annual income?
Calculate the total annual income by multiplying the monthly salary by 12 months.
$$ \text{Annual Income} = \text{Monthly Salary} \times 12 $$ $$ \text{Annual Income} = \text{Rs } 66,000 \times 12 $$ $$ \text{Annual Income} = \text{Rs } 792,000 $$ His total annual income is $\boxed{\text{Rs } 792,000}$.- b) What amount of his salary is deposited in CIT yearly?
Calculate the monthly deposit in CIT (10% of monthly salary).
$$ \text{Monthly CIT Deposit} = 10\% \times \text{Rs } 66,000 $$ $$ \text{Monthly CIT Deposit} = 0.10 \times \text{Rs } 66,000 = \text{Rs } 6,600 $$Calculate the yearly deposit in CIT by multiplying the monthly deposit by 12 months.
$$ \text{Yearly CIT Deposit} = \text{Rs } 6,600 \times 12 $$ $$ \text{Yearly CIT Deposit} = \text{Rs } 79,200 $$ The amount deposited in CIT yearly is $\boxed{\text{Rs } 79,200}$.- c) What is his total taxable income?
Identify the total annual income and total deductions.
Total Annual Income = Rs 792,000 (from part a) Total Deductions = Yearly CIT Deposit + Annual Insurance Premium Total Deductions = Rs 79,200 + Rs 350,000 Total Deductions = Rs 429,200Calculate the total taxable income by subtracting total deductions from the total annual income.
$$ \text{Taxable Income} = \text{Total Annual Income} - \text{Total Deductions} $$ $$ \text{Taxable Income} = \text{Rs } 792,000 - \text{Rs } 429,200 $$ $$ \text{Taxable Income} = \text{Rs } 362,800 $$ His total taxable income is $\boxed{\text{Rs } 362,800}$.- d) How much tax does he pay in a year?
Determine the applicable tax rate based on the taxable income.
Taxable Income = Rs 362,800 (from part c) According to the tax rate table:- Income up to 6 lakhs: 1% Since Rs 362,800 is less than 6 lakhs, the applicable tax rate is 1%.
Calculate the tax payable.
$$ \text{Tax Payable} = 1\% \times \text{Taxable Income} $$ $$ \text{Tax Payable} = 0.01 \times \text{Rs } 362,800 $$ $$ \text{Tax Payable} = \text{Rs } 3,628 $$ He pays $\boxed{\text{Rs } 3,628}$ in tax in a year.
Was this helpful?
Still stuck on this one?
Ask a follow-up, and the answer starts from this question.
Got a different question?Ask your own question
More Business/Management Questions
QMrs. Latha furnishes the following information for the P.Y. 2024-25: (Ignore Alternative Tax Regime…QThe following table shows part of a monthly income tax rates for a certain year. In a certain month…QMr Buti, a 55-year-old salesman earned a gross income of R27 678 per month during the 2020/2021 tax…QA lady earns a basic salary of Kshs. 32,000 per month. She also receives a medical allowance of…QMr. John Smith earns Rs. 1,50,000 per annum as a tax-free income. He has also received Rs. 25,000 as…
Browse by topic:Finance

Handwritten Step-by-Step Solution
Get this as a handwritten image on WhatsApp — like a tutor wrote it for you.
Try on WhatsApp