Odishatv Bureau

If you are a salaried employee, then you should know how to read your pay slip properly. It contains information like allowances and deductions that could help you to reduce your total tax amount. Now, these options can only lessen the tax onus but not entirely eliminate them. As per Section 10 of the Income Tax Act, a taxpayer can dwindle the tax amount with the aid of multiple allowances. These tax-saving options will trim your tax-paying value to an extent.

Deductions Under Section 80GG: This tax-saving option is for employees who don’t get HRA or House Rental Allowance from his or her said employer. There are certain norms he or she should fulfil to claim this benefit. If you haven’t received the HRA claim, you can apply for this benefit under Sec 80GG. If you have rented a place to stay along with your spouse and kids. If you have a property of your own but couldn’t claim deductions on the same.

Gratuity: This is one form of payment given by the employer to the said employee as a token of gratitude for working so many years in the respective organization. It’s paid after an employee bids farewell to the organization after working for a set period. The factors required to compute gratuity include previous drawn salary, basic DA (dearness allowance), and years of service in the organization. Case-in-point, Krishna joined the organization in 2012 and resigned in 2022. His last drawn salary was INR 40,000. So, what’s the gratuity amount paid to Krishna? The value is {(40,000/26X15) X 10} = 230,769. Krishna gets to claim gratuity up to INR 20 lakhs.

Medical Insurance: Since the budget announcement in 2018, this tax-saving option has been included in the employee’s benefit list. The maximum amount you can claim under this is INR 50,000. Also, it’s not obligatory to furnish any documents as proof to claim this benefit.

Leave Encashment: Some employees don’t use their paid leaves given by the organization. If left unexploited, these leaves will carry forward to the next month, and henceforth. Now, only a few organizations allow employee to encash their accumulated paid leaves. The amount the employer pays to the employee on the unused leaves at the end is referred to as leave encashment.

Food Allowance: Certain organizations offer the benefit of providing meal coupons or food allowances to employees. So, he or she has the right to claim this deduction or benefit of a maximum amount of INR 2,600 every month.