Income Tax Exemptions for Salaried Employees / Individuals
Every year most of the people eagerly wait for the budget proposals to be announced for various reasons. The most important one is on the Exemptions permitted for salaried employees and individuals.
Income tax exemptions for salaried employees are revised every year in the budget proposals but the changes are not significant as compared to change in tax slabs.
Standard Deductions that were applicable upto Year 2006 has been converted to Basic Exemption, and the amount allowable under this basic exemption has been raised in almost every budget.
| Income tax slab for ay 10-11 | ||
| Income Tax Slabs for ay 10-11 for Resident Senior Citizens (FY 2009-10) | ||
| S. No. | Income Range | Tax percentage |
| 1 | Up to Rs 2,40,000 | No tax / exempted |
| 2 | 2,40,001 to 3,00,000 | 10% |
| 3 | 3,00,001 to 5,00,000 | 20% |
| 4 | Above 5,00,000 | 30% |
| Income Tax Slabs for ay 10-11 for Resident Women (below 65 years) (FY 2009-10) | ||
| 1 | Up to Rs 1,90,000 | No tax / exempted |
| 2 | 1,90,001 to 3,00,000 | 10% |
| 3 | 3,00,001 to 5,00,00 | 20% |
| 4 | Above 5,00,000 | 30% |
| Income Tax Slabs for ay 10-11 Others & Men (FY 2009-10) | ||
| 1 | Up to Rs 1,60,000 | No tax / exempted |
| 2 | 1,60,001 to 3,00,000 | 10% |
| 3 | 3,00,001 to 5,00,000 | 20% |
| 4 | Above 5,00,000 | 30% |
Revised income tax slabs for the financial year 2010 and 2011
| Income tax slab for ay 11-12 | ||
| New Income Tax Slabs for ay 11-12 for Resident Senior Citizens (FY 2010-11) | ||
| S. No. | Income Range | Tax percentage |
| 1 | Up to Rs 2,40,000 | No tax / exempted |
| 2 | 2,40,001 to 5,00,000 | 10% |
| 3 | 5,00,001 to 8,00,000 | 20% |
| 4 | Above 8,00,000 | 30% |
| Income Tax Slabs for ay 11-12 for Resident Women (below 65 years) (FY 2010-11) | ||
| 1 | Up to Rs 1,90,000 | No tax / exempted |
| 2 | 1,90,001 to 5,00,000 | 10% |
| 3 | 5,00,001 to 8,00,00 | 20% |
| 4 | Above 8,00,000 | 30% |
| New Income Tax Slabs for ay 11-12 Others & Men (FY 2010-11) | ||
| 1 | Up to Rs 1,60,000 | No tax / exempted |
| 2 | 1,60,001 to 5,00,000 | 10% |
| 3 | 5,00,001 to 8,00,000 | 20% |
| 4 | Above 8,00,000 | 30% |
Apart from the above-mentioned exemption, there are some more Statutory exemptions available for salaried employees applicable under Section 10.
HRA Exemption
HRA allowance received by the employee Or Actual rent paid – (10% of Basic + D.A.) Or 50% of (Basic + D.A.) incase the location is (Mumbai, Kolkata, Chennai, Delhi) or 40% of (Basic + D.A.) in case of other cities. Or whichever is less of the above three.
Conveyance Exemption
Maximum Exempted u/s 10 upto Rs.9600 p.a. (i.e. @ Rs. 800 per month when paid along with the salary)
Medical Exemption
Maximum Exempted u/s 10 upto Rs.15000 p.a. based on the bills produced by the employee (i.e. @ Rs. 1250 per month when paid along with the salary)
Education Exemption
Maximum Exempted u/s 10 upto Rs.2400 p.a. based on no of dependent children’s declared by the employee (i.e. @ Rs. 200 per month when paid along with the salary)
Telephone Exemption
Maximum Exempted u/s 10 upto Rs.18000 p.a. based on the bills produced by the employee
(i.e. @ Rs. 1500 per month when paid along with the salary)
Petrol and Vehicle Maintenance Exemption
For Car: Rs. 1200 p.m. * 12 months = 14,400
For Driver: Rs. 600 p.m. * 12 months = 7,200
These are the sum total of all the exemptions allowable for Salaried Employees. However there are many Deductions, Tax Benefits & Tax Breaks under various sections, which are permissible for computation of Income Tax. This will be dealt in a separate article.
LTA Exemption
LTA is exempt to the tune of ecomony class airfare for the family to any destination in India, by the shortest route. For Assessment Year 2010 – 2011 the applicable Block is Year 2006 – 2009. LTA can be claimed twice in a block of 4 calendar years. The Next block is from Jan 2010 to Dec 2013.
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Dear,
Please advise regarding the detail information about Infrastructure bond which is having Rs.20,000 exemption in Income tax annually.
Is these bond are readily available in the market.
How can i go ahead about the same.
Thank You
Deepak Singh Rawat
Deepak,
When the Companies are declaring the Infrastructure bonds in the markets that time only you can buy them like now a days Larsen & Tourbo has declared the bonds and these bonds are for specific periods ( last date of bond is around 15th of jan, 12 )you can buy these bonds in this period only . These bonds you can get from any investment company, share broking firms or if you have dmate account, can buy directly.
In my opinion, for employees of Central and STate Government exployees, including Public Sector Undertakings, the amount realised due to VRS upto the extent of Rs.25 Lakh should be exempted from payment of Income Tax, from the existing level of Rs.5 lakh. The limit fixed is long back and considering the hike in salary and increase in cost of living etc., Finance Ministry should sympathetically consider my suggestion. If this limit is raised upto 25 Lakh, more and more employees will opt VRS and get out from the government employment. This will help the youngsters, who are more talented, to get an opportunity to serve the nation more efficiently.
There are many ELSS Infrastructer Bonds in Bazar, but govt exempt all ELSS saving fund from tax benifit, then how Infrastructer Bond will growth for next years ? Can you send solution ?
sir, I am Physically Handicapped employee. As handicapped how much rebate is possible to me in my salary. Income Slabe rate may be given.
as a physically handicapped salaried employee, what are the deductions available to
me to reduce my income tax burden
Maximum Exempted u/s 10 upto Rs.9600 p.a. (i.e. @ Rs. 800 per month when paid along with the salary)
Dear Sir,
My office deducted tax without considering my Housing Loan and savings for this financial year 2010-11. For the same i got last year excemption.
Please tell me what should I do, to get excemption from my tax for HRA and savings.,
Prashant
Dear Sir,
This site is very usefull for Salaried Emp. Please elaborate this HRA rules.Actually my basic salary is 100541.00 and the HRA received by the company is 40219.00. My actual rent is 3000.00/month and the above calculations are based on 11 months because i joined this company in May 2011. Please do the calculation based on 11 months Please suggest me how much HRA i can exempt on Tax.
Regards Aditya
is cpf deduction is inculed in dedection of RS. one lac or speartely in govt employee
dear sir,
can i have the tax rebate in case of physically handicapped employee.
please provide both the cases i.e. p.h.(more than 40%) and
severe p.h. (more than 80%). i am a govt employee and my gross pay is
more than 1.80 lacs. i would be highly obliged..
thanx
1. I am a bank employee and availed one month’s salary encashment and leave travelling concession upto 4000kms without producing tickets. The bank has reimbursed 75% of notional fare of railway tickets. whether it is taxable??? If yes,under which section ???
2. My son who is wholly dependent on me, met with an accident and was hospitalized. We spent around 55000/- on his treatment and my bank reimbursed me only 29000/-. Out of 29000/- what amount is exempted from income tax and under which section ??
Please reply asap.
I am a handicapped person working in central Government(joined recently).
Could anybody provide GO’s or Office Memorandums of MOWR regarding conveyance allowance and Professional tax exemption and any other benefisiery Go’s related to handicapped persons.
Please provide asap
Any chage (Increase in limit) for paid along-with salary
HRA Exemption – 40% & 50% of Basic + DA
Conveyance Exemption – Previously 9600 Rs per annum
Medical Exemption – Previously 15000 Rs per annum
Education Exemption – Previously 2400 Rs per annum
LTA Exemption –
Please update if any change in exemption amount will helpful for Salaried person.
Nirav
There is no change in this
The exemption given to Infrastructure Bond to the tune of 20000 in AY 2012-13 is still hold good for the AY 2013-14 or is it scrapped
The exemption given to Infrastructure Bond to the tune of 20000 in AY 2012-13 is still hold good for the AY 2013-14 or is it scrapped . Is it within the limit of one lachor other than 0ne lack. how can i save other than u/s 88
Dear Sir,
Kindly advise whether Rajiv gandhi Equity S S will save the the deductible tax of 25000 if invested in Equity Mutual funds. That is if my tax to be deducted is 25000 & I invest in Rs.50000 as per Rajiv gandhi ESS I will save 25000.
Please advise.