If you are looking for the answer to your question of 'What is effective tax rate?' then here is the explanation for you, the effective tax rate is an average rate at which an individual or corporation is taxed. It is different from marginal tax rate. It is calculated by dividing the income tax expenses by the income earned before taxes. Use our simple online effective tax rate calculator to calculate the tax rate in percentage which is the profitability indicator ratio.
If you are looking for the answer to your question of 'What is effective tax rate?' then here is the explanation for you, the effective tax rate is an average rate at which an individual or corporation is taxed. It is different from marginal tax rate. It is calculated by dividing the income tax expenses by the income earned before taxes. Use our simple online effective tax rate calculator to calculate the tax rate in percentage which is the profitability indicator ratio.
Calculate the effective tax rate of a textile company in which its income tax expenses be Rs.100000 and pretax income be Rs. 1000000.
Tax Rate = (100000 / 1000000) x 100
= 10 %
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