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How To Make Your Income Tax-Free Even After Earning Rs. 10 Lakh In FY 2022-23?
Written by Gagandeep Arora - Date - 20th April 2022
Suppose an individual has a total income of Rs.10,00,000 from salary and Rs. 20,000 as interest income. Let us study how we can reduce the taxable income for FY 2022-23. Firstly, there is a standard deduction of Rs. 50,000 for salaried individuals. This will bring down the taxable income to Rs.9.7 lakh.
Secondly, there will be tax-saving investments under Section 80C, which will bring the taxable income further down by Rs. 1.5 lakh.
Thirdly, investing in NPS will further reduce the taxable income by Rs.50,000 as per Sec 80CCD(1b).
Fourthly, Now we have reduced our Income Tax payable to Rs.7.7 lakh. Let’s study further how to reduce our Income tax payable. If an assessee is living on rent then a claim exemption can be made for HRA, or else a deduction can be made against the home loan if not living on rent. Suppose this further brings down the taxable income by Rs.2 lakh, taking our taxable income to Rs. 5.7 lakh. Fifthly, medical insurance can be claimed for Rs. 25,000 if an assessee is below 60 years of age. A further claim of Rs.50,000 can be made for senior citizen parents. This makes our taxable income Rs.4.5 lakh, so according to the Income Tax Slab for FY 2022-23, we are not liable to pay any tax. A taxpayer becomes eligible for a full tax rebate under section 87 A. Wise planning can help an assessee escape the tax net.
Conclusion-Plan Tax Wisely
If your salary is Rs. 10,00,000 then your taxable income will be nil if each component of the salary is planned wisely. If you earn more than Rs. 10,00,000 then also wise planning will make your taxable income less. Planning wisely is the key to success here. So, plan your taxes cleverly for FY 2022-23.
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