By offering several exemptions and deductions, the Income Tax Department enables taxpayers to lawfully lower their taxable income. By reorganizing your compensation and making the most of tax-free benefits, you may make up to ₹17 lakh annually without having to pay income tax.
 
You can benefit from certain deductions and allowances brought about by the new tax system if you work in the private sector.  You must work with the payroll or human resources department of your business to put these benefits into effect.
 
How Can I Earn ₹17 Lakh Without Paying Tax?
For salaried people, the Union Budget 2025 provided a great deal of relief.  According to the Finance Minister, income up to ₹12 lakh annually is exempt from taxes.  However, a salary of ₹17 lakh can potentially become fully tax-exempt by utilizing specific exemptions and allowances.

Allowances That Can Help You Save Tax

• Reimbursement for mobile and Internet Bills
 Employees who get reimbursements from their employers for their mobile and phone bills are eligible for complete tax exemption.  Both the previous and new tax regimes have no set cap, but the amount must be appropriate and in line with the worker's duties.  Ask your HR department to add this perk to your pay if it isn't already.
 
 • Transport Allowance for Disabled Employees
 Employees with disabilities are eligible for a tax-free transportation allowance to help with the costs of commuting from their homes to the workplace.  These personnel are free from paying taxes of ₹3,200 per month or ₹38,400 per year.
 
• Conveyance Reimbursement
 If an employee submits bills to the company's finance department, this allowance—which is different from the travel allowance—is tax-free.  To make use of this perk, speak with your HR department if it isn't covered by your pay plan.
 
 • Employer's car Lease Policy
 Many businesses allow their staff to rent cars.  Despite being a prerequisite, it nonetheless has a modest taxable value.

Taxable Perquisite Value:
Car with engine capacity below 1.6L: ₹1,800/month taxable
Car with engine capacity above 1.6L: ₹2,400/month taxable

Both new and old tax regimes use the same valuation formula for this perquisite.

Additional Deductions in the New Tax Regime

• Standard Deduction of ₹75,000
•  Employer's Contribution to NPS (up to 14%) - Tax-Free
•  Employee's EPF Contribution (12%) - Tax-Free

By combining these exemptions and deductions, your effective taxable income can be reduced to zero on a salary of ₹17 lakh per year.
 
You may maximize your take-home pay while legally lowering your tax obligation by comprehending and improving your pay structure. To put these adjustments into effect and take advantage of tax-free profits, consult your HR department.
 
 
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SIBY JEYYA

27/02/2025 07:59 AM