Hi,
When creating a salary structure is standard deduction a mandatory component? Need some clarity on this if this has to be mentioned specifically
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Hi @Swati
Yeah, central govt. has made it mandatory to be excluded from the TDS calc. and currently it’s 50,000 from the taxable income.
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Standard deduction means a flat deduction to individuals earning salary or pension income. It was introduced back in Budget 2018 in lieu of exemption of transport allowance and reimbursement of miscellaneous medical expenses. For the FY 2019-20 & FY 2020-21 the limit of the standard deduction is Rs 50,000.
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Standard Deduction will not be part of the Salary Structure. It will be used only for tax calculation purpose.
It does not impact the Salary structure of an Employee.
It is a benefit for all the salaried employees given by default under the Income-tax rules.
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