Budget 2010 Update for Salaried Employees

Budget 2010 Update for Salaried Employees

A. Increase in take-home salary

The income tax slabs have been expanded in Budget 2010. Income above Rs. 5 lakh will be

taxed at 10 per cent, income between Rs. 5-8 lakh will be taxed at 20 per cent, and income

above Rs. 8 lakh will be taxed at 30 per cent.

The impact of expanded tax slabs will be an increased take-home salary. See the table

below for the increase in your take-home salary based on your taxable income:

Taxable Income Increase in monthly take-home salary

Up to Rs. 3 lakh Nil

Rs. 4 lakh Rs. 687 (men), Rs. 858 (women)

Rs. 5 lakh Rs. 1,717

Rs. 6 lakh Rs. 2,575

Rs. 7 lakh Rs. 3,433

Rs. 8 lakh and above Rs. 4,292

B. Additional savings of Rs. 6,180

After Budget 2010, you can make an additional investment of up to Rs. 20,000 in long-term

infrastructure bonds to get additional tax savings of Rs. 6,180.

These tax savings are over and above the Rs. 1 lakh investment for PPF, NSC, tuition fees

etc., under section 80C.

C. Housing Loan

If you wish to take a home loan and the cost of the house does not exceed Rs. 20 lakh, then

the home loans of Rs. 10 lakh will cost less till 31st March 2011.

Forgot to present investment receipts during proof verification?

You can make the investment/payment for income tax deductions till March 31, 2010. Even

if your receipts are not considered for TDS deduction, you can still claim tax refund in your

income tax return for all the investments that you make during the financial year.

Since the income tax returns are e-filed, you do not need to attach any investment receipts

or any other document with your e-return. You should keep the receipts with your for your

records.