By Sudhir Kaushik, Taxspanner.com
Chennai-based engineer V. Srikanths income is reasonably high, but more than 18% of it goes in tax. Taxspanner estimates that Srikanth can cut his tax by over Rs 58,000 if his company rejigs his pay package and he saves more for retirement. If Srikanths company reduces his special allowance and puts Rs 1.17 lakh in the NPS under Sec 80CCD(2d), his tax will be cut by Rs 36,000. Unfortunately for Srikanth, his company does not allow restructuring of the pay package so this is only a theoretical possibility.
To cut his tax, Srikanth should on invest Rs 50,000 in the NPS under Sec 80CCD(1b). This will reduce his tax by Rs 15,450. Srikanth is 48, so he should go for a conservative asset mix in his NPS inv…
Read the full article at: http://economictimes.indiatimes.com/wealth/tax/tax-optimizer-shift-from-bank-fds-to-debt-funds-nps-can-help-srikanth-save-tax/articleshow/59607157.cms