Structure a Tax explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Structuring your salary well can reduce your tax legally, especially under the old regime. Here are the key components to use.
Tax-saving components (old regime)
- HRA — exempt based on rent, salary and city
- LTA — exempt for domestic travel on leave
- Standard deduction of ₹50,000
- Employer NPS contribution (80CCD(2)) and meal/telephone reimbursements
Deductions
- 80C investments (PF, ELSS, LIC) up to ₹1.5 lakh
- 80D health insurance premiums
- Home-loan interest under Section 24
New regime note
The new regime has lower rates but few deductions; compute tax both ways and pick the lower.
Frequently Asked Questions
How do I structure a tax-efficient salary?
Use HRA, LTA, standard deduction, employer NPS and reimbursements, plus 80C/80D deductions under the old regime.
Does salary structuring help in the new regime?
Less so — the new regime disallows most exemptions but has lower rates.
Is employer NPS contribution tax-free?
It is deductible under Section 80CCD(2), even in the new regime.
Which regime should I choose?
Compute tax both ways and pick the one with lower tax.
Need help with this?
TaxClue's CA/CS experts handle GST, income tax and compliance end-to-end — fully online, transparent pricing.
Talk to an expert →