How to Calculate Tax on 'AGRICULTURAL INCOME'

How to Calculate Tax on 'AGRICULTURAL INCOME'


  1.  Take the sum of the agricultural income and non-agricultural income. The tax (A) should be computed on this amount.


  1.  The base tax slab changes as per the change in Income Tax guidelines.
  2. Add the base tax slab to the agricultural income. Another Tax (B) needs to be computed on this sum.
  3. Deduct (B) from (A). That will be the Agricultural Income Tax liability. Agriculture Tax = (A) – (B)
  4. Any available rebate, applicable surcharge and education cess are added too to the final taxable amount.

Let us say that an Individual Assessee has a Total income of INR 422700/- (excluding Agricultural income) and a Net Agricultural income of INR 185000/-. Then, per this step, Tax shall be computed on INR 422700/- + INR 185000/- = INR 607700/-. Thus, income Tax amount as per this step shall be INR 607700/-


Tax at normal rate  

607700 (Total income) – less basic exemption limit Rs (250000)

357700 tax 5% (5% of Rs 5,00,000 less Rs 2,50,000) = 12500

107700   20% (20% of Rs 107700) = 21540

Total Tax = 34040


Tax on agriculture income –

 185000 ( 5% of Rs 185000) = 9250


 Total tax = 34040

 Tax rebate on agriculture income = 9250

 Tax rebate 87a = 12500

 Tax payable =  12290

Hope this Helps. 






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