Are you aware that 40% of companies in India have salary structures that are tax inefficient? According to a new study by Pluxee India, this inefficiency leads to lower take-home pay for employees. The study, which is based on email responses from over 16,000 executives across various departments in 97 companies, highlights the need for optimizing benefits packages.

As per the study, optimizing benefits packages could potentially increase employees’ annual take-home salaries by approximately Rs 1 lakh. Many salaried employees are unaware of the numerous tax exemptions available to them when they spend on specific purposes related to their official duties.

Despite the fact that 56% of decision-makers are aware of how benefits can increase annual take-home salaries, the study found that 45% of companies only offer an average of two employee benefits. The most common benefits offered include meal cards (86%), leave travel allowance (54%), and fuel and driver salary (38%).

According to Anish Sarkar, the chief executive of Pluxee India, companies are now looking to increase take-home salaries without significantly raising compensation. By restructuring benefits packages to offer multiple benefits at once, companies aim to provide more value to employees without increasing costs drastically.

However, managing benefits can be a complex process for many organizations. The study found that one-third of employers find benefits management to be intricate and claim processing to be lengthy. With 43% of organizations still using paper-based methods and 70% of digital management systems lacking a mobile app, claims processing can be time-consuming.

While companies may shy away from implementing new digital solutions due to fear of disrupting the employee experience, Sarkar believes that streamlining processes using technology can significantly improve the benefits management experience. With the right technology in place, companies can effectively address compliance, ease of bill submission, and tracking.