If you also pay tax, then it is very important for you to know this news. Actually, according to a new decision of the government, now the employees will not have to pay even 1 rupee tax on earning up to 12 lakhs. Let us know in detail in the news below.
Finance Minister Nirmala Sitharaman presented the country’s budget (Budget 2022) on 1 February 2022. Job professionals were pinning their hopes on this budget, but no change was made in the income tax slab.
In such a situation, all the salaried tax payers have become disappointed, but still if you do a little planning, you can save the entire tax on salary up to Rs 12 lakh. Most people think about saving tax at the last moment, but tax saving is not a one day, one week or one month game.
For this, you should start planning from the beginning of the year. If you do the right planning, optimize the salary, all the exemptions and deductions are there, then surely you can save tax on salary up to Rs 12 lakh. That is, you will have to pay no tax up to Rs. 12 lakh salary (Zero tax on rs. 12 lakh salary).
First understand what happens in salary-
There is basic salary and dearness allowance ie DA in everyone’s salary, on which you do not get any exemption and you have to pay full tax on it. Apart from this, there are various types of special allowances and reimbursements in the salary, which can include things like HRA, LTA, Conveyance Allowance, Food Coupons, Internet Bill, Phone Bill, Fuel Bill. Let us know how to manage them that zero tax on your salary up to 12 lakhs.
HRA is most important in saving tax.
The government believes that people go to other cities for jobs and live there on rent. In such a situation, the government gives tax exemption on the HRA i.e. House Rent Allowance received from the company. However, there are some rules regarding how much exemption will be available on HRA, otherwise people will take the entire salary in HRA only. For HRA, you have to calculate 3 numbers and whichever is the lowest, you will get tax exemption.
1- Which is received in salary from the HRA company.
2- 50% of basic in metro city and 40% of basic in non metro city.
3- The remaining amount after deducting 10% of the basic from the rent. That is, if your basic is Rs 2 lakh and the annual rent is Rs 1.20 lakh, then you can get the benefit of HRA up to Rs 1.20 lakh – 20 thousand ie Rs 1 lakh.
Leave Travel Allowance, which will give the benefit of traveling-
This is such an allowance, which very few people take advantage of. You can take advantage of this 2 times in 4 years. Under this, if you go somewhere for a trip, then you will get full tax exemption on the amount of fare that will be charged for commuting. However, there is a condition in this that the company should have the facility of giving you LTA. Suppose you go somewhere for a trip, where the rent is Rs 10,000. If your family is of 4 people, in which there is husband-wife and two children, then your travel fare will be 80 thousand rupees.
If your company gives a part of salary up to Rs 80 thousand in LTA, then you can get tax exemption on Rs 80 thousand. So if your company does not provide LTA then talk to HR and avail LTA. If you come in the 30% slab, then with the help of LTA you will save a lot of money. If seen, in a way, your travel ticket will be 30 percent cheaper, which is no less than a great offer.
Children Education Allowance and Hostel Allowance-
These are such allowances, in which exemption is not available for a lot of money, but sometimes even just because of Re 1, your salary comes under the purview of taxable income. In such a situation, you should not give up any tax exemption, whether it is small or big. These allowances are Children Education Allowance and Hostel Allowance. However, its benefit is available only to those whose children are studying in the school. If he is studying while staying in the hostel, he will also get hostel allowance. Under these two, you get a total tax exemption of up to Rs 9600.
Make sure to claim reimbursement
Many people find reimbursement to be a hassle and prefer to stay away from it. Who collects all kinds of bills, gives them to HR after adding them and then takes his money, instead of going through so much trouble, he takes this money in his salary as a special allowance. If you also think like this, then first change this thinking. Do claim reimbursement.
Do not consider bill submission as a hassle, as it can help you save a lot of tax. Under this, you can claim the expenses incurred for the business, which includes phone bill, internet bill, fuel bill etc.
Not only this, many companies also offer meal coupons, under which you get two meal coupons per day for Rs 50. Now instead of coupons, cards like Sodexo are also available, in which there is no hassle of bills. It is not necessary that you use it only for eating food, but it can also be used for buying groceries, eating pizza etc.
If your company works for 26 days in a month, then you can get 2 miles coupons (Rs. 100) daily. In this way, throughout the year, you will get Rs 26,400 under the Meal Voucher. You can claim it in reimbursement. That is, this much money will be reduced in the calculation of your salary and your taxable income will come down.
Now know which deductions will be available-
We have talked about getting all kinds of exemptions, now let us know which deductions are available. Let’s see its complete list
1- First of all, every salaried person gets a standard deduction of Rs 50,000. That is, you blindly reduce 50 thousand rupees from your salary.
2- After this comes the turn of 80C, under which you can invest up to Rs 1.5 lakh and take advantage of tax on it. Under this, you can invest in PPF, Sukanya Samriddhi Yojana etc. Under this, you also get a discount on the tuition fees of the child.
3- After this comes the deduction available on investment in NPS under 80CCD. You can get an additional deduction of 50 thousand rupees on investment in this.
4- Whereas under 80D you will get tax exemption on health insurance. You can get tax exemption on health insurance premium up to Rs 25,000 for yourself and Rs 50,000 for parents.
5- You can get tax exemption on Rs 5000 by getting preventive health checkup done.
6- On home loan and electric vehicle loan, you can get tax exemption on interest up to Rs 1.5-2 lakh according to different conditions. This exemption is available under 80EE.
7- Not only this, you can also get tax exemption up to Rs 10,000 on the interest received on savings account and FD. At the same time, this exemption for senior citizens is 50 thousand rupees.
Now understand the calculation-
First of all, you have to deduct all the exemptions from your salary. If your salary is Rs 12 lakh, then first of all, remove the standard deduction of Rs 50 thousand from it, then your salary will be Rs 11.50 lakh. If you take tax exemption of Rs 1.5 lakh on this under 80C, then the salary will be Rs 10 lakh only. If you pay a rent of Rs 13-15 thousand every month, then you can claim HRA of at least Rs 1.5 lakh.
After this your taxable salary will be Rs 8.5 lakh. Take LTA from the company and get a deduction of around Rs 80,000, after which your taxable salary will be Rs 7.7 lakh only. Apart from this, you will get 20 thousand rupees from the company only for phone and internet bills. That is, if you reduce this by Rs 20 thousand, then the taxable income will be saved by Rs 7.5 lakh.
On this you will get tax exemption of meal coupons on around Rs 26,400. That means now your salary is saved at Rs 7,23,600. You will easily spend up to Rs 50,000 on health insurance for yourself and your family. Suppose you take a family floater plan of Rs 10 lakh for husband-wife and two children, then you will have to spend around Rs 20,000.
On the other hand, if you take a plan of 10-10 lakhs for parents, then due to their age, their premium will be high and it will go above about 25-30 thousand rupees, then you can easily get about 50 thousand rupees from health insurance. can save. In this way your taxable salary becomes Rs.6,73,600. The conveyance reimbursement you get from the company will also be around Rs 1.6 lakh annually. If you reduce that also, then your taxable salary will be Rs 5,13,600.
Now your salary has come very close to 5 lakhs, you have to arrange only 13,600 rupees. If you have children, you will get Children Education Allowance and Hostel Allowance up to 9600. After this your salary will be Rs 5,04,000. Now invest at least 4 thousand rupees in NPS which will be useful for you on retirement and now your tax will be saved.
Tax rebate of up to Rs 2.5 lakh is given by the government to those with a taxable salary of up to Rs 5 lakh. Means your tax has become zero. However, reimbursements like conveyance, meal coupons, internet have a big role in this zero tax. So if these facilities are not available from your company then talk to HR and reduce your tax burden. In the absence of these reimbursements, your tax burden becomes much higher.