Breaking News
Loading...
Share It

Enter your email address:

Powered by Feedio

Showing posts with label Save tax for salaried people. Show all posts
Showing posts with label Save tax for salaried people. Show all posts

Tuesday 30 November 2021

 Save tax for salaried people,Central Budget 2021 results

Exemption from ITR filing for senior citizens aged 75 years and above, only pension and interest income.

 

B. The Income Tax Department has introduced pre-filled ITR with additional details to facilitate the return filing process.

C. The deadline for submission of delayed and amended returns has been reduced to 3 months. This means that the IT department has to process the returns and send a notice under section 143 (1) by 31st December.

 

Picture of tax exemption

 

 It is important to understand what your tax slab and each of your pay segregation elements mean. This can help you determine how to save tax.

 

Category I - Understanding your payslip

Basic salary

It’s a specific component of your paycheck and it forms the basis of other parts of your paycheck, hence the name. For example, HRA is defined as the percentage of this basic salary (as considered by the company). Your PF is deducted 12% of your basic salary. This is usually a large portion of your total salary.

House rent allowance

 

Salary earners, who live in rented houses/apartments, can claim house rent allowance or HRA for a tax deduction.  The Income Tax Act prescribes a procedure for calculating HRA which can be claimed as an exemption.

 

Download Auto Home Rental Calculator U / s 10(13A) in Excel

 Save Tax for salaried people

Case Study: Manika works at an MNC in Nagpur she's the company pays her a house rent allowance. But she does not live in a rented house because she lives with her parents.

 

How can Manika use this allowance?

Malaika can rent to her parents and claim the allowance if they own the land they currently live on. All he has to do is enter into a rental agreement with his parents and transfer money to them every month.

 

Also, keep in mind that your HRA will be fully taxable if you receive and do not rent an HRA.

 

Holiday travel allowance

Paid workers can get concessions for travelling in India under LTA. Discount only for the shortest distance on one trip. This allowance can only be claimed for a trip taken with your wife, children and parents, but not with other relatives. This special discount depends on the actual cost, so if you don't really make the trip and don't cover these costs, you can't claim it. Submit a bill to your employer to claim this discount.

 

Bonus

Performance Incentive, whatever its name may be, is 100% taxable. Performance bonuses are usually linked to your valuation rating or your performance over a period of time and are based on company policy.

 

Employee Contribution to Provident Fund (PF)

Future Fund or PF is a social security initiative of the Government of India. Both the employer and the employee make an equivalent contribution of 12% of the employee's basic salary per month towards the employee's pension and provident fund. About 8.65% interest is accrued from FY 2018-19 (previously it was 8.55% for FY 2017-18). This is a retirement benefit that must be paid by companies with more than 20 employees in accordance with the EPF Act, 1952.

Standard deduction

 

Standard deduction U/s 16(ia) was first reintroduced in the 2018 budget. This deduction replaces transportation allowance and medical allowance. Employees can now claim a flat for Rs. 50,000 (before Budget 2019, it was Rs. 40,000) deducted from the total income, resulting in lower tax costs.

 

Professional tax

Occupational tax or employment tax is a tax levied by a state, just like the income tax levied by the central government. The maximum amount of professional tax that can be levied by a state is Rupees Two Thousand Five Hundred. It is usually deducted by the employer and submitted to the state government. On your income tax return, professional tax is deducted from your salary income.

 

Relief under section 89 (1)

If you have to get any arrears salary you can avail this section 89(1)

Calculate tax relief yourself

A. Calculate the tax payable on the total income including the additional salary in the year received.

 

B. Calculate the tax payable on the total income after deducting the extra salary in the year received

C. Calculate the difference and steps 1 and step 2

D Calculate the tax payable on the total income of the year related to the arrears including E Calculate the difference between step 4 and step 5

F The additional amount in step 6 in step 3 is the tax relief that will be granted.

Note that if the amount in step 6 exceeds the amount in step 3, no relief will be allowed.

 

Download Automated Income Tax Preparation Excel Based Software All in One for the Government and Non-Government (Private) Employees for the Financial Year 2021-22 and Assessment Year 2022-23 U/s 115BAC

Save Tax for Salaried Person

Form 16

 Feature of this Excel Utility:-

 

1) This Excel Utility Prepare Your Income Tax as per your option U/s 115BAC perfectly.

 

2) This Excel Utility has the all amended Income Tax Section as per Budget 2021

 

3) Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E from the F.Y.2000-01 to F.Y.2021-22 (Updated Version)

 

4) Automated Calculation Income Tax House Rent Exemption U/s 10(13A)

 

5) Individual Salary Structure as per the Govt and Private Concern’s Salary Pattern

 

6) Individual Salary Sheet

 

7) Individual Tax Computed Sheet

 

8) Automated Income Tax Revised Form 16 Part A&B for the F.Y.2021-22

 

9) Automated Income Tax Revised Form 16 Part B for the F.Y.2021-22

 

10) Automatic Convert the amount in to the in-words without any Excel Formula