Tax Planning for Salaried Employees — 15 Strategies to Save Tax
By Parul Singh, GST Practitioner · Tax Planning
Table of Contents
I plan taxes for 500+ salaried employees every year. The difference between planning in April vs March? 40,000-80,000 in saved tax.
As a salaried employee in India, your salary structure and investment decisions can significantly impact your tax liability. Here are 15 proven strategies to save tax legally.
Salary Structure Optimization
- HRA exemption: Minimum of (a) Actual HRA received, (b) 50% of basic (metro)/40% (non-metro), (c) Rent paid - 10% of basic
- LTA exemption: Block of 4 calendar years, claim for domestic travel
- Food coupons: Up to ₹60/day tax-free (Sodexo)
- Transport allowance: Tax-free up to ₹1,600/month
- Internet/phone reimbursement: Actuals, usually tax-free
Deductions Beyond 80C
- 80D: ₹25,000 (₹50,000 for parents) health insurance premium
- 80CCD(1B): Additional ₹50,000 for NPS
- 80E: Interest on education loan (no limit, 8 years)
- 80EEA: ₹1.5 lakh additional home loan interest (affordable housing)
- 80G: Donations to specified funds and charities
Pro Tip: Submit Form 12BB to your employer with proof of all investments before January to ensure correct TDS deduction.