: How do I calculate tax liability on the turnover of a small vendor? I run a bakery with a turnover of RS 3.00 Lakhs in fiscal year 2012-2013. What is my tax liability on this turnover?

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There are quite a few questions as to how you are recording your income and expenses.

If you are running the bakery as a Sole Proprietor, with all the income and expense in a business account; then things are easy. You just have to pay tax on the profit [as per the standard tax bracket].

If you running it as individual, you are still only liable to pay tax on profit and not turnover, however you need to keep a proper book of accounts showing income and expense. Get a Accountant to do this for you there are some thing your can claim as expense, some you can't.