How Can I Restructure Our Salary Breakup to Maximize Employee Tax Rebates Without Extra Costs?

Hi All,

I'm new to this group and I'm a little bit confused on how to use this. However, I still want your suggestions on some matters. I'm working as an HR Coordinator in a small company, and I am the only person in the HR Department.

The issue at hand is that I want to redefine our salary break-up so that employees can get the maximum tax rebate without imposing any extra burden on the employer. Our current salary structure is as follows:
- Basic Salary
- HRA
- Transport Allowance
- Others
- PF

However, employees are not satisfied with this structure. They believe there might be a better way to maximize tax rebates by restructuring the salary break-ups.

Please assist me if you have any suggestions for this matter. I am looking forward to your reply.

Pooja

Hi, Pooja,

I work in an MNC, and our salary breakdown is as follows:

SALARY
- Basic
- HRA
- Personal Pay
- Conveyance Allowance
- LTA

REIMBURSEMENTS
- Medical

RETIRALS
- PF
- ESI
- Bonus

All the best!

Regards,
Sandhya

Hi Pooja,

I have a little knowledge of salary break-up. This is what I follow:

Basic + DA: 60%
HRA: 20%
CCA: 10%
Others: 10%

You can calculate it this way:

Basic + DA: 60%
HRA: 20%
CCA (Travel allowance): 20%
Others: 10%

Or, you can give me your email, and I will forward it to you. My email is nagendra.hr104@gmail.com.

Regards,
Nagendra
Hyderabad

Hi Sandhya,

Nice to see your quick reply, but I'm looking for a detailed description of the same. If you want, I can specify what I'm looking for.

Pooja

Dear Pooja,

Probably, you can add components like:

- Conveyance allowance (tax-free up to Rs. 800 per month)
- Reimbursements with actual bills for:
- Medical bills
- Books & Periodicals
- Uniform maintenance allowance
- and so on

Sashmita

Dear Sashmita,

What about FBT on the reimbursements you have mentioned here? Does it apply or not?

Anu

Hi all,

Can you suggest whether a salary slip for every month is necessary for the future? The issue is that where I am working, my employer does not provide any salary breakup or salary slip. Please do the needful.

Well, if your employer does not provide a salary slip, you can ask for a salary certificate before leaving your job. Can anyone suggest a breakdown for a 1.5 lakh package, please? Thank you.