Budget 2018: Impact of Budget on Salary

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  • By Taxmann
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  • Last Updated on 4 January, 2021

Union Budget 2018 Impact on In-Hand Salary of an Employee:

 

PARTICULARS

 Gross Salary

 Rs. 12,00,000

 After Budget

 Before Budget

Basic Salary (50% of Gross Salary)

             600,000

            600,000

Add: Allowances

 

 

Special Allowance

             261,000

            261,000

HRA** (50% of Basic Salary)

 

** Assuming an employee incurs 20% of his gross salary to pay rent for his house

 

             300,000

            300,000

Children Education Allowance

                 1,200

                1,200

Children Hostel Expenditure Allowance

                 3,600

                3,600

Medical Reimbursement

               15,000

              15,000

Transport Allowance

               19,200

              19,200

 

 

 

Gross Salary (A)

          1,200,000

         1,200,000

Taxable Salary (B)*

             975,200

            981,000

Less : Deductions (C)

 

 

A. Section 80C

             150,000

            150,000

(Insurance Preimum, Children School Fees, Post Office Scheme, etc.)

 

 

B. Section 80D

               25,000

              25,000

(Medical Insurance Premium)

 

 

 

 

 

Taxable Income (D) = (B – C)

             800,200

            806,000

Total Tax Liability (E)

               75,442

              75,911

 

 

 

TDS per month (E)/12

                 6,287

                6,326

 

 

 

In Hand Salary Per Month

               93,713

              93,674

 

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