FINANCE MANAGER OF ONE OF MY CLIENT'S GROUP COMPANY HAS COME TO ME TO DISCUSS THE FOLLOWING:- HE IS A FINANCE MANAGER OF MID SIZED IT COMPANY. HE JOINED IT IN THE MONTH OF DEC 07. HE HAS OBSERVED THAT SALARY STRUCTURE IS NOT PROPERLY DRAWN THERE. WHAT SHOULD BE THE IDEAL SALARY STRUCTURE FROM TAX PLANNING POINT OF VIEW?...THEY HAVE TWO CATEGORIES OF EMPLOYEES:- 1. JUNIOR CATEGORIES - SALARY BELOW RS 10000/- 2. SENIOR CATEGORIES - SALARY ABOVE RS. 10000 to RS. 60000.
PLEASE ANSWER THIS QUERY...DO YOU HAVE BEST TAX-SAVER SALARY STRUCTURE?
19 March 2008
As per Indian Taxation laws, you will get benefit under teh following components of salary. Conveyance Rs. 800 / month. HRA , least of the following: a. 50 % of Salary b. Excess of Rent paid over 10 % of Salary c. Actual HRA received.
Salary for this purpose means Basic. PF calculated on Basic and DA is eligible for Deduction u/s 80 C.
19 March 2008
they should give HRA & COnveyance allowances. otherwise they can provide fbt perquisites & recover fbt from employees from high amount paid employees.
19 March 2008
You can ask him to segregate it under the following 1. Medical Allowance ~15000P.A. 2. Uniform Allowance 3. LTA 4. Conveyance ~ 9600 P.A. 5. HRA ( 50% of basic ) 6. Professional Development reimbursement
CAclubindia
