Employeeâs contribution â Section 80CCD (1) Allowed to an Individual who makes deposits to his/her Pension account. Maximum deduction allowed is 10% of salary (in case of taxpayer being an employee) or 10% of gross total income (in case of tax payer being self-employed) or Rs 1, 50,000 whichever less is.
This applies to current, former and retired employees. Premiums you pay for employees' group life insurance that is not group term insurance or optional dependent life insurance are also a taxable benefit.
Taxable and Non-taxable Allowances. Iâve noticed some questions on Yahoo answers about which allowances are taxable and which are not. At the current time, the only taxable allowance is CONUS COLA, the Cost of Living Allowance paid to people who living in certain expensive parts of the continental United States. By federal law, all new allowances created after 1986 will be taxable.