Taxes are the one math problem everyone has to solve, but nobody teaches you how. Whether it's figuring out GST on a restaurant bill or estimating your income tax liability, the formulas are simple — but the rules aren't.
These 15 questions cover the tax calculations people actually need.
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Multiply the base price by the tax rate. Example: ₹2,000 item with 18% GST = ₹2,000 × 0.18 = ₹360 tax. Total = ₹2,360. Use the [Tax Calculator](/tax-calculator) for instant results with any rate.
Divide the total by (1 + tax rate). Example: Paid ₹2,360 with 18% GST. Original = 2,360 ÷ 1.18 = ₹2,000. Tax = ₹360. This is called reverse tax calculation — the [Tax Calculator](/tax-calculator) has a dedicated mode for it.
5% for restaurants with annual turnover below ₹50 lakh. 18% for restaurants with turnover above ₹50 lakh, AC restaurants, and those serving alcohol. 5% applies without input tax credit (ITC); 18% applies with ITC. The rate applies to the total bill including service charge but excluding tips.
GST is calculated on the post-discount price, not the original. If a ₹1,000 item has a 20% discount, GST applies to ₹800, not ₹1,000. At 18% GST: tax = ₹144 (not ₹180). However, the discount must be applied before or at the time of supply — post-supply discounts don't reduce GST liability.
No. Consumers cannot claim GST refunds. Only registered businesses can claim Input Tax Credit (ITC) — GST paid on business purchases can be deducted from GST collected on sales. As a consumer, you bear the final GST cost. This is by design — GST is a consumption tax paid by the end user.
India uses a progressive slab system — higher income portions are taxed at higher rates. Under the new regime (FY 2024-25): 0-3L = 0%, 3-7L = 5%, 7-10L = 10%, 10-12L = 15%, 12-15L = 20%, above 15L = 30%. A ₹10L salary pays: 0 + 20,000 + 30,000 = ₹50,000 tax (before cess). Use our [Tax Calculator](/tax-calculator) for exact calculations.
The old regime allows deductions (80C up to ₹1.5L, 80D for health insurance, HRA exemption, home loan interest under 24b). The new regime has lower slab rates but eliminates most deductions. For salaried employees with ₹2-3L in deductions, the old regime usually saves more. For those with minimal deductions, the new regime is simpler and often cheaper.
TDS (Tax Deducted at Source) is tax your employer deducts from your salary before paying you. If your estimated annual tax is ₹1,20,000, your employer deducts ₹10,000/month as TDS. You see the post-TDS amount in your bank account. At year-end, file your return to claim any excess TDS as refund.
Under the old regime: Section 80C (PPF, ELSS, life insurance — up to ₹1.5L), Section 80D (health insurance — ₹25K self, ₹50K parents), Section 24(b) (home loan interest — up to ₹2L), HRA exemption (rent paid). Under the new regime: Standard deduction of ₹50,000 is the main benefit. For most salaried people, the old regime with 80C + 80D + 24(b) saves ₹30,000-80,000 more than the new regime.
Only if your total income exceeds the basic exemption limit (₹3L under new regime, ₹2.5L under old). Part-time job income, freelancing income, and stipends above ₹15,000/month (if not exempt) all count. Most students earning under ₹3L/year owe zero tax. But if you earn ₹4L from freelancing, you owe tax on the amount above ₹3L.
July 31 is the standard deadline for filing ITR for the previous financial year (April-March). For FY 2024-25 (AY 2025-26), the deadline is July 31, 2025. Late filing (up to December 31) attracts a penalty of ₹1,000-5,000 plus interest on any tax due. Missing the December deadline means you cannot file that year's return at all.
If you owe tax: penalty of ₹1,000-10,000, interest at 1% per month on unpaid tax, and potential prosecution for amounts above ₹25 lakh. If you don't owe tax but were required to file: ₹1,000 penalty. If your income is below the taxable limit, there's no penalty for not filing — but filing creates a record useful for visa applications, loan approvals, and credit building.
Yes. Freelance income is taxed under 'Profits and Gains from Business or Profession.' You can deduct legitimate business expenses (internet, laptop, coworking space, software subscriptions) before calculating taxable income. If annual freelance income exceeds ₹20L, GST registration is mandatory. Use the [Tax Calculator](/tax-calculator) to estimate your liability.
Form 16 is a certificate from your employer showing your salary, TDS deducted, and tax computations for the year. You need it to file your ITR accurately. If you've switched jobs during the year, collect Form 16 from each employer. Without Form 16, you'll need to reconstruct your income from salary slips and bank statements.
Divide the total by (1 + GST rate) to find the base price. Then multiply the base by the GST rate. The result should match the tax shown on the bill. Example: Bill shows ₹1,180 total with ₹180 GST at 18%. Check: 1,180 ÷ 1.18 = ₹1,000 base. ₹1,000 × 0.18 = ₹180. ✓ Correct. If the numbers don't match, the bill may have an error — or the merchant may be overcharging.