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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

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2. 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?
  1. 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?
  2. Calculate the monthly deposit in CIT (10% of monthly salary).

    $$
    \text{Monthly CIT Deposit} = 10\% \times \text{Rs } 66,000
    $$
    $$
    \text{Monthly CIT Deposit} = 0.10 \times \text{Rs } 66,000 = \text{Rs } 6,600
    $$
    
  3. 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?
  4. 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 429,200
    
  5. Calculate 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?
  6. 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%.
  7. 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.
    
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