This document explains salary allowance taxability and TDS computation under both Old and New Tax Regimes, helping readers understand how different allowances affect taxable income and monthly deductions.
It includes a detailed allowance wise table that clearly classifies each component based on taxability, eligibility under both regimes, and applicable exemption limits for accurate salary structuring. The document also specifies required supporting documents for each allowance to ensure proper compliance and help employers and employees avoid errors during payroll processing.
It provides a practical example that explains step-by-step TDS calculation under both regimes and demonstrates the impact of allowances, exemptions, and tax rates.
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Prepared by : Aditi Soni www.linkedin.com/in/aditi-soni-368113317
This article is only a knowledge-sharing initiative and is based on the Relevant Provisions as applicable and as per the information existing at the time of the preparation. In no event, RMPS & Co. or the Author or any other persons be liable for any direct and indirect result from this Article or any inadvertent omission of the provisions, update, etc if any.
Published on: March 18, 2026