How NPS and other benefits might reduce income tax by Rs. 1 lakh

Software expert Surajit Ghosh, who works in Hyderabad, makes a good living but has to pay a lot of taxes because his compensation structure is not very tax-friendly. According to TaxSpanner, Ghosh might potentially lower his tax liability by almost Rs. 1.1 lakh by switching from tax-inefficient fixed deposits to debt funds and receiving additional tax-free benefits. Although Ghosh now receives a few tax-free benefits, he ought to look into the potential of obtaining a leave travel allowance (LTA). His tax will be reduced by Rs. 31,200 with an LTA of Rs. 1 lakh. He should also request a gadget allowance from his employer. Gadgets and home appliances purchased under the company's name and given to the employee for personal use are subject to only 10% tax under Section 17(2). This benefit became apparent during the "work from home" period following the lockdown brought on by COVID-19. Ghosh's tax will be lowered by about Rs.37,500 if he purchases computers, white goods, and air conditi