Sanchi Sudha
Hr Manager
Daisy Singh
Sr. Manager(hr)
+1 Other

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Hello Everyone, Can any body help me out or provide sheet n formula how to Calculate TAX deduction from salary?
From India, Gurgaon
Dear Sudha,

There are many components for calculating TDS on salary. First off all you have to check the salary structure which should comprises of Basic, HRA, Conveyance, Medical Allowance etc. There could be optional points as well like LTA, Re-imbursement Policy etc.

Presently upto Rs. 2.50 L salary in completely tax free. Above that before calculating the TDS, we need to consider the Deductions, Allowances, Benefits allowed by IT Dept.

There are 3 criteria for HRA Exemption. Check with your payroll.

Conveyance Allowance Exemption of Rs. 1600/pm is permisible for deduction

Medical Exemption is allowed Rs. 15000/pa

After making the above exemptions, you will have Gross Salary Income (For IT)

From the Gross Income, there are certain deduction towards Investment, Mediclaim, Donations, loans etc.

Under Section 80C Rs. 1.50 L deductions is allowed.

Interest on Housing Loan.

Mediclaim.-Rs. 15 k /pa

Education Loan

After considering the above there is a tax slab with different %.

If you want to reduce tax liability of employees, pls launch some re-imbursement policies.

The above is a short script of Tax Deductions, Allowance, etc. For detailed pls contact some payroll or Finance Team of your company.

From India, Delhi
Can you send some reimbursement parts showing in CTC structure. Daisy Singh
From India, Delhi
Thnx Daisy for your valued Appreciaiton.
Pls find list of some re-imbursement exp. Fuel Allowance, Telephone Exp., Uniform Allow., Car/Vehicle Maintenance Allowance, LTA etc.
For proper taxation, pls consult your finance/accounts team.

From India, Delhi
Thanks Mr. Pan Singh, to provide your valuable time. And also to answer my query.. Can you please elaborate it more clearly with example. Suppose the female person salary is Basic: Rs.7000/pm, HRA: Rs. 3500/pm, Conv Allowance: Rs. 800/pm, Medical: Rs.1500/pm. and his CTC is 300000. So how would we calculate it's TAX? and she is given the rent of approx Rs. 5000/pm.
From India, Gurgaon

Thnx a ton for nice words and valued appreciation on my comments.

In above case NIL tax is applicable. As already stated 2.50 L is Tax Free for the f.y.. The female employee will entitle for Coveyance, Medical, HRA Exemptions.

After making these standard deductions her Salary Income will be less than Tax Slab. But pls note there are certain rule for HRA exemption.

Before following such deduction/s-exemptions kindly go thru the guidelines issued by IT dept. (You can have advice from Finance Team).

But for your control, you can ask all such employee to submit Tax Declaration Form. In the declaration the employee will submit HRA proof/s, Savind Detail, and other deduction proof/s. On basis of the declarations and deductions you can also issue them Tax Computation Sheet in which applicable tax will be reflected.

Moreover, this will help you to make platform for next year tax liability/ies.

You can save such declaration for your future reference. Such documents can be asked by Income Tax Officer during scrutiny of ITR of your company.

Hope this will meet your requirement.

From India, Delhi
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