What is Income Tax

Income Tax is an example of Direct Tax.

When a person earns his/her income during a particular period then, at the end of that relevant period he/she is required to pay tax on his income. This is known as Income Tax.

For the purpose of Income Tax, the term person includes:

An individual
A Hindu Undivided Family (HUF)
Association of Person (AOP)
Body of Individual (BOI)
Local Authority
A person has to pay Income Tax if he earns income from various sources such as:

Income from Salaries
Income from House Properties
Income from his Business or Profession
Income from Capital Gain
Income from Other Sources
The amount payable under Income Tax depends upon how much income a person is generated.

There are different slab rates, according to which a person has to pay his Income Tax. The income taxslabs also depend upon the age of the individual.