I am facing a big problem with my compensation structure because other than education allowance and conveyance, I don't have anything that can save tax from their earnings.
Can anybody tell me what other components I can include to help employees save money? Note: We don't pay anything in cash to employees; even a single paisa will get transferred to the bank account.
Regards,
Chirag Jain
From India, Mumbai
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Can anybody tell me what other components I can include to help employees save money? Note: We don't pay anything in cash to employees; even a single paisa will get transferred to the bank account.
Regards,
Chirag Jain
From India, Mumbai
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Hi Chirag,
You can add REIMBURSEMENT components in the salary structure like MEDICAL REIMBURSEMENT, KNOWLEDGE UPDATE, UNIFORM ALLOWANCE, PETROL & MAINTENANCE, and HELPER. On all the above components, on the production of the bills every month, you can treat them as NON-TAXABLE; otherwise, it will be TAXABLE income.
Hope this will help you in setting up the structure.
Regards,
Jijo
From India, Mumbai
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You can add REIMBURSEMENT components in the salary structure like MEDICAL REIMBURSEMENT, KNOWLEDGE UPDATE, UNIFORM ALLOWANCE, PETROL & MAINTENANCE, and HELPER. On all the above components, on the production of the bills every month, you can treat them as NON-TAXABLE; otherwise, it will be TAXABLE income.
Hope this will help you in setting up the structure.
Regards,
Jijo
From India, Mumbai
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Hi folks, I heard that car lease also to a lot of extent helps in saving the tax liability but i dont have much info as such. If anybody can throw light on the same would be great. Thanks JJ
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Dear all, As per my knowledge the allowances given in the salary grid are not taxable until you produce the bills for them. All the allowances are non-taxable
From India, Bangalore
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1From India, Bangalore
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Dear All,
In our new budget, there have been some changes. Now, all fringe benefits will be taxable. Will these expenses still be covered under non-taxable components?
- MEDICAL REIMBURSEMENT
- KNOWLEDGE UPDATE
- UNIFORM ALLOWANCE
- PETROL & MAINTENANCE
- HELPER
- Conveyance REIMBURSEMENT
I am already providing conveyance reimbursement because it is not considered as earnings for employees, therefore, I am not including it as part of their salary component.
Regards,
Chirag
From India, Mumbai
Acknowledge(0)Amend(0)
In our new budget, there have been some changes. Now, all fringe benefits will be taxable. Will these expenses still be covered under non-taxable components?
- MEDICAL REIMBURSEMENT
- KNOWLEDGE UPDATE
- UNIFORM ALLOWANCE
- PETROL & MAINTENANCE
- HELPER
- Conveyance REIMBURSEMENT
I am already providing conveyance reimbursement because it is not considered as earnings for employees, therefore, I am not including it as part of their salary component.
Regards,
Chirag
From India, Mumbai
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Hi,
To save tax:
Special allowance can be split into:
1. Car Hiring - Non-taxable up to Rs 1,20,000 per annum
2. Petrol allowance/maintenance - Non-taxable up to Rs 1,80,000 per annum
3. LTA - Rs 3000 per annum
4. Driver Salary - Rs 60,000
5. Education allowance - Rs 12,000
Above the mentioned limits, 16.5% tax will be applicable. The split mentioned above can be very helpful in saving tax. However, it would depend on the compensation structure provided or followed by the employer.
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To save tax:
Special allowance can be split into:
1. Car Hiring - Non-taxable up to Rs 1,20,000 per annum
2. Petrol allowance/maintenance - Non-taxable up to Rs 1,80,000 per annum
3. LTA - Rs 3000 per annum
4. Driver Salary - Rs 60,000
5. Education allowance - Rs 12,000
Above the mentioned limits, 16.5% tax will be applicable. The split mentioned above can be very helpful in saving tax. However, it would depend on the compensation structure provided or followed by the employer.
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hi, for availing tax exemption on car petrol & maintence reimbursement, shud the car b on employee’s name only or can it be on any of his/her family member’s name too? pl reply
From India, Hyderabad
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From India, Hyderabad
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Employee Benefits.doc