Based on the income tax slab, every individual has to pay tax in India. However, there are measures that can be used to pay zero tax on salary. In this post, we will discuss how to save tax on salaries above 10 lakh.
Yearly Income
Up to INR 2.5 lakh
Tax Slab As Per Old Tax Regime
NIL
INR 2.5 lakh to INR 5 lakh
5%
INR 5 lakh – INR 7.5 lakh
20% + Rs. 12,500
INR 7.5 lakh – INR 10 lakh
20% + Rs. 12,500
INR 10 lakh – INR 12.5 lakh
30% + Rs 1,12,500
INR 12.5 lakh – INR 15 lakh
30% + Rs 1,12,500
INR 15 lakh and above
30% + Rs 1,12,500
Yearly Income
Up to INR 2.5 lakh
Tax Slab As Per Old Tax Regime
NIL
INR 2.5 lakh to INR 5 lakh
5%
INR 5 lakh – INR 7.5 lakh
10% + Rs.12,500
INR 7.5 lakh – INR 10 lakh
15% + Rs.37,500
INR 10 lakh – INR 12.5 lakh
20% + Rs.75,000
INR 12.5 lakh – INR 15 lakh
25% + Rs.1,25,000
INR 15 lakh and above
30% + Rs 1,12,500
If you want to know how to save on above 10 lakhs income tax, you should first understand your Salary Structure to be able to save more. There are various grants and tax exemptions allowed under a salary. The taxable income is the amount of salary that doesn’t come under the purview of any exemptions.
Various Salary Component that comes under Tax Exemptions include:
1. Basic Salary
2. Dearness Allowance
3. HRA or House Rent Allowance
4. LTA or Leave Travel Allowance
5. Mobile/Internet Allowance
6. Education allowance for Children
7. Food Allowance
8. Standard Deductions
9. Professional Tax
1. On policy premium of your Health insurance (Under Section 80D)
2. On loan for higher education (Under Section 80E)
3. Charity Donations (Under Section 80G)
4. Investments done in tools of tax saving (Under Section 80C)
5. On disabled dependent treatment cost (Under Section 80DD)
6. Deductions are available on home loan
7. Also on the Life Insurance Policy maturity amount