7 Income Tax Tips for Salaried Individuals

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Income Tax Tips for Salaried Individuals

As salaried individuals, most of us don’t have the luxury of taking up a second income to make enough money to alleviate tax losses and match our ambitions. A far better way to earn more is a careful analysis of your salary structure to reduce income tax payments to a minimum and correspondingly increase your net receivable salary.

7 Income Tax Tips for Salaried Individuals

  1. If your boss has been consistently refusing your requests for a pay raise even after you completed that hefty project, it might be time to talk to your HR department to change the structure of your salary. It is a well-established principle of taxation that expenses incurred to achieve a job goal ought not to be considered a part of taxable income. For instance, you might have to travel to meet a client, attend a business conference, call clients on your personal phone buy magazines or books to complete research on a project, HRA etc. All these are expenses that your employee should boot the bill for. Ask your reporting manager to lump a percentage of your basic salary to cover these work related expense heads. Perks and allowances are not taxable under various clauses of Section 10 of the Income Tax Act, 196However, some perks that are taxable include:
    1. City Compensatory allowance.
    2. Fixed Medical allowance.
    3. Allowances to cover expenses on food.
    4. Servant allowance.
    5. Dearness allowance.
    6. Overtime allowance.
    7. Telephone allowance.
  1. You can save up to Rupees 1,50,000 for investments under sections 80C, 80CCC and 80CCD. Typical investments under these sections include:
    1. Provident Fund payments.
    2. If a housing loan has been obtained from a recognised institution, then the principal borrowed under that loan (upto Rupees 2,00,000 annually).
    3. Investments in a Public Provident Fund scheme.
    4. Tuition fees of school-going children for up to 2 children.
    5. Life Insurance premiums if taken in the name of your spouse, children or your self.
    6. National Savings Certificate schemes of India Post.
    7. Sukanya Samriddhi Yojana account opened in the name of a female child.
  2. Section 80E allows you to deduct interest paid on an Education Loan (taken from an approved financial institution) for studying abroad from your taxable income. No limit to this amount has been specified. The principal amount of the monthly instalment, however, does not qualify for the same treatment.
  3. Medical insurance premiums if taken in the name of your spouse, children or self. The ceiling for this income tax deduction is Rupees 25,000. If parents over 60 years of age are also insured, you can avail an additional Rupees 25,000 as deduction.
  4. Agricultural Income is totally exempt from income tax according to Section 10 of Part III of the Act.
  5. Dividends received upon investing in long term equity shares or mutual funds. Long term means a period in excess of 12 months.
  6. If you just got married then there’s plenty of good news. The monetary value of gifts that you receive at the time of marriage are

your-income-tax-return--made-simple

These are just a few of the commonest ways you can save the money you pay as income tax and if you pay TDS then the amount can be claimed as income tax refund when you e file your ITRs online. There are occasions when your investments and sources of income are complex. In such a case, it is best to consult a tax expert, preferably through an affordable buy quality online platform.

This information is provided to you in the public interest courtesy of AllIndiaITR, a product of Corwhite Solutions Private Limited.

6 COMMENTS

  1. Thnx for this this really help me alot.This blog is really helpfull for us to know more about 7 Income Tax Tips for Salaried Individuals. This tell us everything that we should know about 7 Income Tax Tips for Salaried Individuals. This is like a algorithm to fill taxes becaute it tell us step by step how we should fill taxes and yes it is also easy to understand. It tell breifly and accurately about taxes. The best thing about this blog is that we can get every information hear only. we shoud not go on different side to search about itr. Great work keep it up.

  2. Great blog very simply explain about everything.Thnx for this this really help me alot.. This tell us everything that we should know about 7 Income Tax Tips for Salaried Individuals. This is like a algorithm to fill taxes becaute it tell us step by step how we should fill taxes and yes it is also easy to understand. It tell breifly and accurately about taxes.This blog is really helpfull for us to know more about 7 Income Tax Tips for Salaried Individuals.

  3. great..found an interesting and really helpful blog regarding tax and salary based tax classification.the best notable thing is that in detailed example based classification regarding tax and salary are described here .neatly and brief words

  4. Amazing. Thank you ALL INDIA ITR for providing these ITR tips through this great write up. These tips are really helpful and I will recommend my colleagues and family members to go through this. I think it will definitely help them. Keep posting this type of articles.

  5. Thanks for this this really help me alot.This blog is really helpfull for us to know more about individual salary taxes. This tell us everything that we should know about income tax payments process. This is like a algorithm to fill taxes because it tell us step by step how we should fill taxes and yes it is also easy to understand. It tell breifly and accurately about taxes. The best thing about this blog is that we can get every information hear only. we shoud not go on different side to search about itr. Great work keep it up.

  6. Thanks this blog has really helped me alot. This really helps and tells a process that is required to fill up an Income tax return. This blog tell us step by step how we should fill taxes and yes it is also easy to understand. Each and every details have been mentioned in simple and clear language.
    i would prefer anyone to have a eye on it to clear all their doubts.The blog tells us how can a middle class person cna save upto 1,50,000 which for a middle class family is alot . Saving taxes and using the same money can help them in planning a better future which is quite essential in this era since a better livelihood is what everyone wants now days. The best thing about this blog is that we can get every information hear only. We shoud not go on different side to search about itr. Great work keep it up.It tell breifly and accurately about taxes. The blog is very detailed and the way it explains the things is very easy to understand and to retain it really helps a person on how to fill up the ITR and how to enquire about it. Great work from ALL INDIA ITR since it is a very well written and a very useful blog. I have one question though what is the difference between public provident fund and provident fund payments.??

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