How to Adjust CTC for Discontinued Sodexo Benefits and Maximize Tax Savings?

Dear All,

We have been providing Sodexo benefits until last month. However, our management has decided to discontinue this practice. Therefore, I need to include that amount in the Cost to Company (CTC). I would like to inquire if there is an allowance available through which employees can receive tax exemptions. Please provide clarification at your earliest convenience.

Regards,
Ranjani

You can try with Uniform Allowance, which is tax-free for employees and employers as well. Have a few more opinions on this before implementing.

PK

Conveyance is exempted up to 800/- per month, i.e., 9600/- per annum.

HRA up to 50% of Basic Salary or actual paid, whichever is less, is exempted.

LTA, if as per IT rules, is applicable once in a block of two years with an option to carry forward to the next block. As per the current Supreme Court decision, there is no need to submit travel proof, only on a declaration basis.

Medical Allowance is exempted up to Rs. 15,000 per annum on the production of bills.

Uniform Allowance is exempted, but it cannot be attire allowance; it has to be for uniforms.

That's all I know for salaried people. Thanks.

Regards,
Pari

Hi,

Can anyone shed more light on uniform allowance or attire allowance? What are the minimum and maximum limits? How can it be implemented?

Thanks & Regards,
PK

Hi,

For LTA, there is good news for all employees! Now, there is no longer a requirement for documentary proof, which can help with tax savings. Please find details attached.

Regards,
Brijesh

Dear All,

Thank you for your inputs. Unfortunately or fortunately, we don't have something called a uniform, so we cannot provide a uniform allowance. However, we do provide all the other allowances as specified earlier. Anyways, thank you all.

Regards,
Ranjani

Hi Brajesh,

Please note that although the Supreme Court has issued its verdicts, they have not yet been ratified by the Income Tax Organization. A notification from them is still awaited. Therefore, for the time being, the LTA rules concerning the submission of proof are in effect.

Hi,

In your salary structure, you can add some reimbursement part (separate from your fixed part of monthly salary) as per the designation. Examples include: Medical, Fuel, LTA, Car Maintenance, Driver, Books, and Periodicals.

Thanks,
Mahender Singh