DIGITAL TAX BUDDY

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INCOME TAX

INCOME TAX

Income tax is a tax imposed by the government on the income earned by individuals, businesses, and other entities within a specific jurisdiction. It is one of the main sources of revenue for governments and is used to fund various public services and programs.

Individuals are generally subject to income tax on their earnings from employment, self-employment, investments, rental income, and other sources. The tax is typically calculated based on the taxable income, which is the total income earned minus certain deductions and exemptions allowed by the tax laws.

Businesses, including corporations, partnerships, and sole proprietorships, are also subject to income tax on their profits. The tax rate and calculation methods may vary depending on the legal structure of the business and the tax laws of the jurisdiction.