Tax planning for f.y. 12-13

Tax queries 863 views 5 replies

Pragnesh Patel

Process Associate

97 Points Joined July 2011

Hi,

I need to give tax plan to my client(women 32 years) for f.y 12-13.

Here annual compensation as per company (CTC) is as follows:

FIXED COMPENSATION

BASIC 70800, PF 8496, GRATUITY 3405, HELTH INSUARANCE 6000, PERFORMANCE PAY 46800,

BOUQUET OF BENEFITS 150380 ( HRA 28320, CONVEYANCE ALLOWANCE 9600, SUNDRY MEDICAL RIEMB. 4800, LTA 5900, FOOD COUPONS 30000, PERSONAL ALLOWANCE 71760)

Currently she has LIC POLICY CONT. OF 7500 AND CONT OF ULIP 5000 ON YEARLY BASIS APART FROM COMPANY OF AND PROFESSIONAL TAX.

Could anly one suggest tax planning.

Regards,

Pragnesh

Replies (5)

meabhijit

Project Manager

172 Points Joined December 2011

Adjust your BoB as below:

Sundry Medical to 15000 p.a

Food Coupons to 36000 p.a

LTA to be changed as per actual bills which can be produced after travel.

HRA to be added as per actuals.

Rest all will be taxable for the BoB.

Pragnesh Patel

Process Associate

97 Points Joined July 2011

Hi,

Increasing the amount of Food Coupons helps in tax saving but such coupons are discounted in market with tax of 7-8%.

Some of my client do't want to recieve such coupons.

Is it advaisable to take food coupons insted of cash.

Regards,

Pragnesh

Prateek Agarwal

Sr. Executive - Finance & Accounts

1732 Points Joined February 2011

Yes, you can take food coupons instead of cash.. They are not treated as perquisites.

Pragnesh Patel

Process Associate

97 Points Joined July 2011

I agree food coupons are best way to save tax.

But it is rally not usefull to salaried people. like on coupon of 100Rs we got goods worth rs 93 and 7Rs goes for tax.

So it reduse purchasing power.

I want to take decision whether go for coupons or for Cash salary?

Regards,

Pragnesh

Prateek Agarwal

Sr. Executive - Finance & Accounts

1732 Points Joined February 2011

Either way you will save a bit on tax if you go for coupons.

In case of cash salary, you will have to pay tax on the whole Rs 100 (as per slab) Even in case of 10% , it comes to Rs 10. But in case of Coupons, its Rs. 7. Hence you save Rs 3 w.r.t. cash salary.

Am i correct sir??