With increasing flexibility in salary packages, restructuring one’s CTC has become vital for optimizing tax benefits. Key components to consider include Basic Salary and House Rent Allowance (HRA). While a higher basic salary incurs more taxes, it also enhances benefits like PF contributions. Balancing this with allowances, such as phone or medical reimbursements, can boost disposable income, especially for senior employees. Optimizing HRA by aligning it with market rates and submitting rent receipts can significantly reduce taxable income.
Maximizing Tax Benefits: Restructuring Your CTC in Old and New Tax Regimes
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