TDS Deduction: as per the income tax laws ofIndia, an employer always deducts Tax Deductedat Source (TDS) from the employee’s salary, if thesalary income crosses the threshold limit. Beforethe end of every financial year, employeesasked to produce their ‘Income-tax declaration’with details of their investments and expenses,which they incurred during the financial year goneby.
Undefined on such declaration, the employermakes tax deductions at source regularly, eitherby deducting further taxes or deducting fewertaxes for the remaining period depending on theactual proofs of investments/savings shown bythe employee.
Here are 8 ways to reduce your tax liability thatarises from TDS being deducted from your salary.
TDS Deduction: Eight Ways To Reduce TDS At
Your Salary Source
To claim this allowance, an employee is expectedto produce particulars, such as name, addressand PAN of the landlord and that too in the caseswhere the aggregate rent paid during the FYexceeds Rs 1 lakh. In case PAN of the landlord isnot available, a declaration in Form number 60should be obtained.
- Food Coupons
If your company does not provide food coupons,you can ask them to consider a proposal. A sumof Rs 50 per meal is exempt on meal vouchers.This means that for a 25-day-a-month workingperiod, meal vouchers can be tax-exempt to theextent of Rs 2,500 per month, considering lunchand dinner (Rs. 100 x 25 days).
- Donations To Trust and Charity
In case you have given certain funds toauthorised trusts, charitable institutions likenotified temples, Prime Minister’s National ReliefFund, National Defence Fund, etc., an employeecould submit the proof of donation in the form ofa receipt containing all particulars name andaddress and PAN of trust or institution, Name ofdonor, Registration number and its validit
- Leave Travel Allowance
Similarly, if your salary break-up does not includetravel allowance, you can always request youremployer to include the same in your salary breakup. Every taxpaying citizen should be incurring thetravel allowance expenses, before claimingexemption.
- Medical Insurance Premium and Claim
Employees may furnish an 80D tax certificatefrom insurance companies in support of thededuction of premium paid along with copies ofthe correct bank statement/passbook as proof ofsuch payment. Further, an employee may alsoneed to produce receipts/bills for any healthroutine check-up undergone during the FY.
6. Interest On Loan Taken For Residential Property
In this case, particulars, including name, addressand PAN of the lender, a certificate from the bankauthorized institution having the details likedate of availing loan, instalment amount andinterest chargeable need to be submitted.
7. National Pension System (NPS)
A copy of the deposit receipt for the amountdeposited during the Financial Year and a copy ofa relevant extract of the bank statement.
Apart from the above, to save TDS on salary makesure you utilize the entire amount by investing insection 80C and other instruments. Among themost preferred routes to reduce your TDS or taxliability from salary would be investing in PPF. ThePublic Provident Fund (PPF) offers you a taxrebate of nearly Rs 1.5 lakhs per annum