How Do I Calculate TDS on My Salary with These Components? Seeking Community Help

Hello Folks,

I am working for a New Delhi-based company. From this financial year, they are streamlining the process of the salary slip, and the management wants to deduct the TDS at the source. My net take-home pay is Rs. 19,000 (monthly), and my annual take-home pay is Rs. 2,28,000 (INR). The components that will be part of the salary structure are given below:

- Basic
- HRA @ 50% of basic
- Conveyance Allowance @ Rs. 800 per month
- Medical Reimbursement - details given below
- Other Allowances

Note:
1. Rent receipt for the HRA paid to you to be submitted every month.
2. Medical reimbursement will be made against bills for medicines/doctor's fees only. This will not be paid monthly as part of the salary. Medical Insurance expense (mediclaim annual charges, etc.) is tax-free up to Rs. 15,000 per annum. Another Rs. 15,000 if paid for parents is tax-free. However, this is against the receipts of payments made.

I have a few queries; please help me out by providing the answers to the queries.

(a) Please give me the bifurcation of the salary of Rs. 19,000 (Please use the above-mentioned salary components).

(b) From the tax planning perspective, I have an LIC of Rs. 1,25,000, and I am paying the annual premium of Rs. 6,600. Please help me out in calculating the TDS that will be deducted from my salary. I am also planning to get a mediclaim of Rs. 2,00,000 for which I have to pay the premium of Rs. 2,869 annually.

(c) Please calculate & suggest how much TDS I am liable to pay.

(d) Is the thumb rule for salary bifurcation correct? Please comment.
Basic = 50% of the CTC
HRA = 50% of Basic
Conveyance = 800

I request the community members to provide me the solution asap.

Regards

Hi Rupinder,

There is no limit on bifurcation as per the law. Generally, companies nowadays put the basic component as 35-60% of gross. It can be within this limit.

HRA is usually 50% of basic as per the IT. Conveyance is fixed at 800 to be tax-exempt. Anything above that would be liable to tax as per the norms.

Medical Reimbursement @1250 can be paid monthly if you provide the bills or as per your submission of bills. If you don't provide bills, it can be collected annually in your April salary, but it would be after tax deduction.

If the management wants to deduct tax at source, then your net would reduce by default as per the TDS rate. For calculating TDS, I would suggest you can get the IT calculator by just googling it for the FY 2009-10.

Regards,
Ranjit