need Explanation


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What is the EBITDA,how should one calculate the taxes from operating income means we were taking x% of tax rate by ourself?

2 Answer(s)


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EBITDA is otherwise known as operating income.
Revenue - COGS - Operating Expenses = EBITDA
If your EBITDA is 10 crores
First you should subtract any interest expense from this, lets say 2 crores.
So you are left with 8 crores for PAT (profit after tax)
Now you will apply the tax rate (based on the company) to this 8 crores.

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Many companies might have carry forward loses etc which will reduce their tax amount.