- Union Budget: Perspective for Beginners
- Union budget 2013: The ideal tax structure for a salaried employee. Of course it’s just a wish!
- HSBC Bank suspends selling of Mutual funds and Insurance in India. Hope all banks follow suit!
- Kudos to SEBI, for No Frills NAV for Direct Investors in Mutual Funds
- Financial Habits
- Financial Planning: Advantages of Financial Planning
- Where is Your Portfolio Headed?
- Measuring Returns - A Simple Technique
- Interpreting Portfolio Returns
- Interest Rate Cycles and How You Can Ride Them
- Home-Made Annuity
- Being a Tax Efficient Entrepreneur
- Citibank and Other Financial Scams
- A Product Less Bad... Is Still a Bad Product
- The Story Behind Inflation
Union budget 2013: The ideal tax structure for a salaried employee. Of course it’s just a wish!
Tax planning always has been confusing. We at fintotal.com thought how the life can be made simpler for the humble salaried employee.
Remove all tax exemption on allowances. Keep it simple. There needs to be just 2-3 heads under salary income
Basic Salary Rs ****
Add: Allowances/Incentives/Bonus Rs ****
Total Salary Income Rs ****
And this is how the computation of tax under salary income should look like
Employee who stays in rented apartment
|
Total salary income |
Rs ***** |
|
Less: |
|
|
Rent relief Section 80R (Actual rent paid or 20% of annual salary) |
Rs **** |
|
Conveyance Relief Section 80C |
Rs 24000 |
|
Regular Medical expense relief Section 80M |
Rs 15000 |
|
Managing risk Section 80I |
|
|
--Mediclaim for self, spouse and children |
up to Rs 15,000 |
|
--Mediclaim for parents |
up to Rs 20,000 |
|
--Term insurance |
up to Rs 40,000 |
|
Providing for future Section 80F (upper limit 10% of annual income) |
Rs **** |
|
--Any mutual fund (lock in 5 yrs) |
|
|
--PPF |
|
|
--ULIPs |
|
|
--NPS |
|
|
Encouraging education Section 80E |
|
|
--Actual tuition fees or 10% of salary income whichever is less |
Rs **** |
|
--Actual EMI on education loan with an upper limit of Rs 3 lacs per annum |
Rs **** |
|
Donations to charity Section 80D(Max Rs 1 lac) |
Rs **** |
|
Total taxable income |
Rs ***** |
Employee who has an home loan EMI
|
Total salary income |
Rs ***** |
|
Less: |
|
|
Home EMI relief Section 80H (30% of EMI paid or 50% of total salary whichever is lower) |
Rs **** |
|
Conveyance Relief Section 80C |
Rs 24000 |
|
Regular Medical expense relief Section 80M |
Rs 15000 |
|
Managing risk Section 80I |
|
|
--Mediclaim for self, spouse and children |
up to Rs 15,000 |
|
--Mediclaim for parents |
up to Rs 20,000 |
|
--Term insurance |
up to Rs 40,000 |
|
Providing for future Section 80F (upper limit 10% of annual income) |
Rs **** |
|
Any mutual fund (lock in 5 yrs) |
|
|
--PPF |
|
|
--ULIPs |
|
|
--NPS |
|
|
Encouraging education Section 80E |
|
|
--Actual tuition fees or 10% of salary income whichever is less |
Rs **** |
|
--Actual EMI on education loan with an upper limit of Rs 3 lacs per annum |
Rs **** |
|
Donations to charity Section 80D(Max Rs 1 lac) |
Rs **** |
|
Total taxable income |
Rs ***** |
Tax slab
|
Upto Rs 3 lacs |
nil |
|
Rs 3 lacs to Rs 6 lacs |
10% |
|
Rs 6 lacs to Rs 12 lacs |
20% |
|
Rs 12 lacs and above |
30% |
