BANGALORE: The amount of tax one pays depends on several factors, including the quantum of earnings of the individual, the sources of his income and the various tax deductions and exemptions availed by him. For salaried taxpayers, much depends on how their compensation package is structured. Your peers with the same salary as you but saving the most tax are able to do so, only because they are making use of these components to match their financial needs most efficiently.

Let’s find out how you can optimize your tax outgo:

1. Restructure Your Salary

There may be many expenses which you are doing because of your job. If you leave your job today, many of your expenses will end. You travel to the office daily only for the job. You may be entertaining clients and spending over them to fulfill your job. You must be reading certain newspapers, magazines or books for your job purpose. It means, these are forced expenses and your employer should pay for them. Such expenses should go to the account of employer expense. Since you are only medium of such expense this should not be part of the income.

Talk to your employer and ask to restructure your pay. You are ought to get perks and allowances for such expense. This should not be part of your salary. These perks and allowances or non taxable if incurred actually.