components of a good salary package

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digvijay (Querist)
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17 April 2009 Hi,
How should a good salary package be formulated so that it attracts the least amount of income tax? Say for a package of 10 lakhs. The package has to be a mix of reimbursements and other perks and exempt incomes so that neither the employer nor the employee are much affected by the tax payout.

Thanks,

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)
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18 April 2009 BASIC
DA
HRA
EDUCATION ALLOWANCE
CHILD EDUCATION ALLOWANCE
CONVEYANCE ALLOWANCE
ATTIRE ALLOWANCE - REIMBURSEMENT
MEDICAL ALLOWANCE - REIMBURSEMENT
PERFORMANCE INCENTIVE
MEDICLAIM POLICY AMOUNT - FOR SELF, WIFE, CHILDREN
LEAVE TRAVEL ALLOWANCE

digvijay

digvijay (Querist)
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18 April 2009 If we take into consideration the BPO sector, attire allowance - is not applicable. Again in the above structure the tax impact is maximum on the employee, we need to distribute it.

Deepak Goel

Deepak Goel (Expert)
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19 April 2009 Most of estabilishments are using this structure. Therefore, BPO can use this. if they are not using then they can change their sturcture

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