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Tax exemption and Optimum salary structure

tax exemptionA good way to reduce your tax liability is to revamp your salary structure and add some components.

Your income tax liability can be reduced if the following components are made use of in an efficient manner:

Leave and Travel Allowance:

The Leave and Travel Allowance, also known as LTC or LTA in common terms is a great way to bring down the tax liability of an Assessee. This LTA amount is given to the employee from the employer so that the employee may go for his leave in any place in India. He himself, as well as his family is covered under this allowance and the amount is exempted. The LTC or LTA amount that an employee receives for a leave spent by him and his family to go to in any place in India upon termination from services or retirement is also eligible for Tax exemption from taxes. The criterion of Actual Expenses however applies to this allowance.

Medical Expenses:

The medical expenses incurred by the Assessee and family members who can be included under the allowance can amount to INR 15000 per annum of  Tax exemption. This amount is also compensated by the employer.

Principal Repayment of Housing Loan:

Amounts leading up to a maximum of INR 1,00,000 is eligible for  Tax exemption in the case of the repayment of the Principal amount toward a home loan. The interests paid are eligible to be tax exempt for a maximum amount of INR 1,50,000. If the acquired home loan is of a higher value then the principal amount and the interest paid may prove to be higher than the allowed tax exempted amount.

Allowance given to an employee employed in the transport system such as Air, Sea, Rail or any such system:

This Tax exemption is allowed in the absence of the employee working under the mentioned transport systems receiving any compensation for his day to day expenses made during his duty that requires him to travel from one place to another. The Tax exemption is allowed for up to 70 per cent of such an amount received by the employee but is limited to an amount of INR 6000 for a month. In such a scenario, in order to gain the maximum  Tax exemption, the Assessee can opt for a joint home loan with a spouse or a parent or sibling. In this case, both the joint owners of the said property can enjoy tax Tax exemption in the right proportions as per the percentage of the loan amount they hold.

Conveyance Allowance:

When an employee is paid allowance for his conveyance that he needs to undertake for his official tasks this allowance is considered as conveyance allowance. The expenses borne by the employee from his gross salary is thus allowed to be exempted from taxes.

Perks or Perquisites like a Car given to the employee:

In the event of an Assessee being provided a car for personal or official purposes, and if a reimbursement is being made by the company towards the fuel expenses, insurance premiums, maintenance costs, and the salary of a driver, if any, the Taxable amount will be

a)  INR 1800 per month in addition to INR 900 towards the driver if the Cubic Capacity of the car equals or is less than 1.6 litres.

b)  INR 2400 per month in addition to INR 900 towards the driver if the Cubic Capacity of the car exceeds 1.6 litres.

If an Assessee uses his personal car for official purposes and receives a reimbursement for the maintenance and running expenses the taxable amount will be

a)  An amount of INR 1800 in addition to INR 900 towards the driver deducted from the exact amount the Assessee receives from the employer if the Cubic Capacity of the car equals or is less than 1.6 litres.

b)  An amount of INR 2400 in addition to INR 900 towards the driver deducted for the exact amount the Assessee receives from the employer if the Cubic Capacity of the car exceeds 1.6 litres.

Rent free furnished accommodation:

Though an accommodation that is rent free and furnished and provided to an employee is treated as a perquisite, the entire payment component that an employee receives from an employer towards this is not entirely taxable. Calculations for tax Tax exemption on the rent free furnished accommodation is based on its estimation and consists of two segments:

Unfurnished accommodation:

When the employer provides unfurnished accommodation to the employee, the rate is calculated as:

a)  In cities where the population is more than 25 lakh, 15 per cent of the total salary.

b)  In cities where the population exceeds 25 lakh but is less than 25 lakh according to the 2001 Census, 10 per cent of the total salary.

c)  In other places, the value of the perquisite will be 7.5 per cent of the salary.

When the accommodation is rented out or leased out by the employer, the rate set is the lower amount of either 15 per cent of the salary or the actual amount that is paid by the employer towards rent or lease.

Furnished accommodation:

When the employer provides furnished accommodation to the employee, the value of the perquisite as calculated by the method used for unfurnished accommodation sees an increase of:

a)  10 per cent of the cost of equipments, appliances, furniture when they are owned.

b)  In the event of the equipments, appliances, furniture being hired, by the total amount that is payable as hire charges.

c)  Or as any charges that the employee may have himself reduced.

The article is the Guest Post contributed by Mr. Aashish Ramchand.  Aashish is a Chartered Accountant by qualification and the Co- founder of makemyreturns.com, an online tax advisory and filing site. He is very passionate about Indian taxes and loves to write articles about the Indian tax system. He has worked with KPMG and JRC advisory both in international and domestic taxation respectively. He has also completed level 1 of CFA (USA) exam.  You can reach Aashish at aashish@makemyreturns.com. You can also follow him on twitter – @aashishjr.

Nature in a capsule. Sky On The Earth

Nature and human being.  Many of us say human being is His greatest creation.  It is not correct in a way.  The nature is most significant creation of Him.  Nature reflects eternal beauty, exuding innocence, selfless benevolence, soulful smile, earthly endurance, divine reflection, vials of panacea, ocean of livelihood, non-discriminatory attitude, and what not.  Nature is everything.  Nature can grow and flourish without human being.  But human being can’t survive without the nature.  In fact we see Him in nature.  We can experience the pure peace and tranquility amid nature.  The pervading benevolence of nature is our livelihood.  The disciplined seasons are our tools of survival.  Despite the treacherous treatment towards nature, she is still supporting us benevolently.  Whereas human being is growing decimal in terms of character, wisdom, righteousness and knowledge.  Human being is shedding his human nature and traveling towards daemonly instincts.  Still there is one thing that makes human being great.  It is the woman.  The life giver on the earth.  The reflection of endurance.  The embodiment of beauty.  The personification of love and the flair of nature.  The poem herein depicts the admiration of a lover about his beloved and her eternal godly smile.  I wish my scribbling become true, I find such an eternal smile and I capture her smile.  Still we can enjoy her smile through this portrayal.

nature and smile blog bee poems

Sky on the earth

The serene skies
The vivid blue
The lucent moon
The celestial stars
All converged to dance on the earth
The dance that played the music of Himalayan streams
The dance that was rendered on my heart and soul
The dance that mesmerized the nature
The dance that inspired divinity
The dance that made my instincts dance
The dance that none can choreograph
The dance that makes me die in awe
The dancing smile of her
The flowing waves of energy
The touching vibes of delight
Let her render the dance eternal
Let me die and live for ever.

This poem is contributed by one of our Guest Authors who write under the pen name ‘Life’.  You may leave your comments here to address him with any queries.

You may ask my soul

Human being is bestowed with beautiful body, mind, heart and soul.  He is further blessed with one great tool called communication to convey his/her feelings, engage with co-beings, and enjoy sweet relationship.  Besides intelligence, this is one basic difference between the human being and the animal.  Animal may behave the way we do and it may eat, sleep, cohabit, co-create the way we do.  Animal is also blessed with similar organs and senses the way we have.  The only difference is the shape, contours, communication and intelligence where man and animal differ from each other.

soul and relationships blogbee images

It is said that man is a social animal.  This saying significantly conveys the state of relationship the animals maintain among their creed.  We regularly witness this fact the way dog maintains its puppies, the way the birds like pigeon nourishes squabs [young pigeons].  We can find many more examples when we explore.

The soul, self or Atman is the real power conferred on human beings.  The soul is the self of human being which is distinctive from the body, mind and heart.  The soul is the transcendental light that powers the human life.  The soul is invisible, pure, immune to senses, indestructible, powerful, bright like His glow and powers the human life.  The soul is the actual path and destination to reach Him.

The conduct of human beings is mostly driven by the mind and entwined with the bodily senses.  It may be to taste a food, to experience a relationship, to earn material things.  Every where, we are trying to please our bodily pleasures and worldly possessions.

Here my scribblings denote a relationship which is not superficial and which is entwined with the soul of the other person.  When relationship gets established at the stature of soul there never would arise a question of the relationship going bad or not being genuine.  The soul to soul relationship is all powerful which converges two human beings into one.  One soul merging with the other.  This is the true power that a human being can achieve with his intuitive understanding of human existence.  This is the true blessing He endowed to human being and this is what not present in the animals.

Soul to soul relationships makes one nothing in absence of other.  This is the true form of love.  This is the true binding agent for life.  Is it possible for today’s youth to achieve this divine relationship in their love and cohabitation?  Yes, certainly, if they give time to understand the other being from his/her perspective and try to match the aspirations to retain relationship.  The secret is to retain relationship.  This should be the mooting point.  When we make a relationship is it that we are making to tentatively satisfy the bodily senses or truly aspiring to live in relationship?  If both the individuals can discover honest answer to this if the former is the answer, the relationship obviously would be temporary.  Where you find the later as the answer in self-discovery then it gives a true platform to nourish a soul-to-soul relationship.  Such a relationship is time testing.  The path generally is challenging.  Still it only gives contentment at each hurdle of reaching the destination.  It is the way when we cut onions there is every possibility of a little burning in eyes.  But the result is entirely opposite.  It pleases your taste buds.  However, in this relationship the end result pleases the God which is the true purpose of human existence.

It is time that youth try for this kind of quintessential relationship to make the world truly pleasant.

soul merging, two souls convering to one

You May Ask My Soul

It is a mystique that shrouds beyond any magnetic power
Alluring me invisibly and attracting me evidently
I am invaded by it body and soul the way Gopikas surrendered to Krishna
I am ceded to its beaming power the way nature pivots on Sun lord
I am empowered by it the way Kalidas was ordained by Kali Matha
I am moved by its persona the way one would get lost at the sight of Himalayas
I am enlightened by it to realities the way the diamond shines through cuts
I am lost myself for ever the way devotees surrender to Him
Today I am not I as I am not there without that power
I have no tomorrow as I have bequeathed my life to that power
My somatic entity is a tool that is surrendered to that power
Who am I today?
I am not sure.
You may ask my soul!

Caravan and true souls

Love is probably the primordial and foremost emotion between two souls in the context of creation and co-creation.  The essence and core of every religious precept is love, peace, righteous conduct, realization of self and reverence to the Almighty.  Though the world acknowledges various religions the followers and faith believers generally are prone to pursue chosen prescriptions of their respective religions to attain undue or undeserving material wealth and power.  Religion enlightens us about the most pious nature of spirit and spirituality.  Spirituality is mostly the highest form of religion where it encompasses the distorted forms of religion and conducts in the true spirit of pure religious tenets that bestow wholesome perspective of world beyond any distortion, discolor or degeneration of original view of relevant religion.  Spirituality is a wholesome feeling that looks at the whole humanity in one spirit and with one eye.  Spirituality is self-less, above board of any religious prejudices, mix of reverence, human concern, and compassion, defines true love, proposes legitimate cohabitation, drives intellect, conscious centric, time less, non-subjective, all inclusive and convergent view of one world, one religion and one love.

The need of the hour is to enlighten youth about this true spirituality which is mostly a non-religious form of disciplined living and which would nurture pure relationship, true love and eternal union of two souls into one.  The world today needs such pure relationship among youth so that they could bring on to earth the true children of God.  The true children would connote the progeny who would by birth endear the earth with perfect human flair and divine glow.

The poem below tries to portray such a situation where the depicted couple get immersed in their true love never minding the falling conduct of rest of the world.

caravan and true souls

Caravan

A big caravan in the biggest ever desert
Stories of travails in search of myth
Idiocy ruling education and intellect caged in ignorance
Money chasing money poverty chasing penury
Soulless relationships defining new love
Fears and aspirations driving spiritualism
It is a caravan with full of cultural contradictions and commotions
Lie in the midst two souls snugged
Who created a garden of divine communion
Who speak intellect and who walk growth
Who bathe in the warmth of emotions
Who savor the truth in benign
Who restrain union fearing the caravan
Caravan is moving towards the oasis
While the two souls inching to convergence
To create a world of true love and savor the power of divinity
God is with them
Nature is with them
Time is with them
What else they need?

This poem is contributed by one of our Guest Authors who write under the pen name ‘Life’.  You may leave your comments here to address him with any queries.

 

Shackles of culture

The world is manifestation of several cultures, contradictions and so many contrasts.  Centuries passed.  Generations went into oblivion.  Many religions and cultures took birth.  There has been a compounding breakage of human fabric into sects, castes, creed and regional identities.  People speak about their rights sans responsibility.  Spirituality is driven by fear.  Money replacing blood.  Relationship has evolved to be a commodity.  Human beings have emerged to be consumers than the individual entities who follow scripture driven or conscious driven conduct.  Mind is over powering the soul.  Soul or self is almost a non-existent to many.  Exploitation is branching into new trees and deep roots.

The individuals who think in true spirit and who would like to walk in their own space are bound by the above contradictions prejudiced and inhibitive culture.  The following is a brief touch of words in the above context.

Shackles of Culture

The shackles of culture and social fear
Douse many a positive currents in the society
Let the world learn the non-discriminatory and
all encompassing nature of nature
Let there be a freedom for legitimate and
Conscious driven conduct of individuals
May the views and perspectives of people in general
see more matured line of thought
Let men and women enjoy the freedom of will
the way the nature bestowed to birds and animals
Let relationships see the state of nothing beyond relationship
May system of intellect equality emerge defying many perceptional trends that destroy legitimate feelings and freedom
Let there come more value to conscientious living of people
Let us not get governed by the age driven, primordial and restrictive strictures on any individual souls
Let intellect dawn on everyone

This poem is contributed by one of our Guest Authors who write under the pen name ‘Life’.  You may leave your comments here to address him with any queries.