Pay 0 tax on income of Rs 1.7 lakh: 2 situations, your income of Rs 1.7 lakh is tax-free in the new tax system
Pay 0 tax on income of Rs 1.7 lakh: Earning a good salary plan is a blessing, but paying income tax can be painful. However, the new tax regime for fiscal year 2025-26 provides tax-free income up to Rs 12,75,000 for paid individuals. Therefore, monthly income exceeds Rs 1,06,000, effectively tax exemption.
If someone earns slightly above slightly higher, they will also receive marginal relief, which will minimize their tax liability.
However, taxes seem to be a huge burden when income is significantly higher than Rs 12,75,00.
In particular, if someone earns Rs 17 lakh annually, they may exhaust any tax saving options, believing that the new tax system will not offer many.
But this is not a case.
Even in the new tax regime, taxpayers can exempt their Rs 17 lakh salary from tax, which will help retirement plans, invest in long-term investments and donate to central government plans if they benefit from certain deductions.
Know how it is possible (2 cases) –
Standard deduction
The standard deduction for individuals with salary grades is Rs 75,000. Its revenue is Rs 12,75,000, tax-free.
NPS Tax Offer
In the new tax system, taxpayers can receive tax benefits for employers’ contributions to their NPS accounts.
In this case, the maximum benefit is 14% of the employee’s basic salary and dear allowance (DA).
There is no tax benefit available for employee contributions.
EPF Tax Offer
Employers have similar tax benefits to their employee EPF accounts. The maximum tax benefit allowed is 12% of the employee’s base salary and DA.
Other key tax benefits of the new tax system
Under Article 80CCH(2), a tax benefit of 100% to the contributions to the Central Government’s Agnipath program.
In fact, in the case of transfer or office transfer, a travel allowance is made for travel purposes.
On a practical basis, the daily allowance, but it will form part of the CTC.
In fact, on the transport allowance, but it will form part of the CTC.
Rental income from rental properties will be exempted up to 30% of the time.
If there is a family pension income, whichever is lower, it is 25,000 or 1/3 rupees.
The maximum remuneration required by Article 10 (10) is Rs 2.5 lakh.
Without considering the deemed rental income, the exemption of the second vacant house will be there.
Income from a life insurance policy under section 10 (10D) is exempt.
Under the fixed allowance under Section 10 (10AA), up to Rs 2.5 lakh is exempt.
The amount of voluntary retirement is exempted under Section 10 (10C) up to Rs 5 lakh.
Taxable currencies not received from the office, such as office laptops, medical policies and interest-free loans are part of the exemption salary.
Transport allowances for dedicated personnel will also be tax-free.
How to make Rs 1.7 lakh tax-free
Total revenue – 17,00,000 rupees
Standard deduction Rs 75,000
EPF Tax Offer (Basic Salary and 12% of DA) – Rs 1,0,2000
EPF Tax Offer (Basic Salary and 14% of DA) – Rs 1,19,000
Tax interest on PPF interest – Rs 17,500
Tax benefits of interest obtained in the post office plan – Rs 3,500
Taxable income after obtaining these tax benefits – Rs 13,83,000
Income tax of Rs 90,448 (including Rs 3,498 as education and health tax on this income
| detail | tax rate | Income (Rs) | Tax amount (Rs) |
| net income | 17,00,000 | ||
| Basic wages (50% of net income) | 8,50,000 | ||
| Less: Standard deduction | 75,000 | ||
| Deductions of EPF (12% of base salary) | 1,02,000 | ||
| NPS deduction U/S 80 CCD (2) | 1,19,000 | ||
| Post Office Program Interest 10 (15 (i) | 3,500 | ||
| Interest in PPF/ Sukanya Yojna (1.5 million + 100,000) | 17,500 | ||
| Net taxable income | 13,83,000 | ||
| Revenue tax exemption up to Rs 4 lakh | zero | 4,00,000 | |
| Income tax tablet is Rs 4 lakh, up to Rs 8 lakh | 5% | 4,00,000 | 20,000 |
| Income tax tablet is Rs 8 lakh, up to Rs 1.2 lakh | 10% | 4,00,000 | 40,000 |
| Income tax tablet is 1.2 lakh rupees, up to 1.6 lakh | 15% | 1,83,000 | 27,450 |
| Total income tax liability | – | 87,450 | |
| The tax rate is 4%, and total income tax should be paid | – | 3,498 | |
| Final income tax liability (including CESS) | – | 90,948 |
How to reduce this tax to 0 (Scheme 1)
One can contribute to the protesters’ plan of the central government (Rs 90,448 in this case) and get a 100% tax break.
How to reduce this tax to 0 (Scheme 2)
Human Resources officials of their companies can be asked to carry out transportation allowances, entertainment allowances, book allowances, etc. Out of Rs 17 lakh income, they can get Rs 90,448 taxes as they tax relaxation on bill claims for these allowances.
