How?

"Structuring your salary is the first and foremost thing to be done, even before you start working. This will atleast ensure that when you get your pay slip there are no nasty surprises in store for you in terms of tax," says Mr. Sandeep Shanbag, Director of an Investment and Tax advisory firm in Mumbai.

But before you go structuring your salary you should know which part of your salary gets the axe on the tax.

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It is your gross income.

So what do you do?

"Get your company to work up a salary structure for you where your net salary is mostly made up of perks that are paid by your company. In other words increase the CTC (Cost to the Company)," explains Mr. Shanbag.

This will show that you have a lesser basic, and your yearly income will get reduced considerably thus getting you obvious tax exemptions.

Here are some of the perks that need to be factored in your pay structure and made to pay by the company.

• Medical Reimbursement

Under medical reimbursement an amount of up to Rs.15, 000 is exempt from tax per year, provided you support it with the required medical bills.

And remember to claim it each month, because if you don't claim it, the amount won't get credited and you lose out on this money. In fact, not claiming will mean you will have to pay tax for this component too.

Remember these factors need to be discussed when you are negotiating your salary and not after.

"This is because most companies do not give you the option to structure your salary. So get it approved when the matter is in the negotiating table," informs Mr. Shanbag.

• Conveyance Allowance

A sum of Rs.800 as transport allowance is exempt from tax. But do not confuse this with your LTA or your official work travelling.

LTA is a separate component altogether in your salary and will be given by a company depending upon your designation or grade.

This Rs.800 or the amount that company pays you based on your designation will come to you in your in-hand salary and won't be taxed.

If you fall in the disabled section then the maximum sum exempted from tax as travel allowance comes to Rs.1600.