How High-Income Indians Are Cutting Taxes? CA Explains In Viral Post

A growing number of high-income professionals are giving up traditional salaried jobs and shifting to consultancy structures to legally reduce their tax burden, according to chartered accountant and educator

Meenal Goel, who highlighted the trend in a widely shared LinkedIn post. Meenal Goel’s analysis shows that salaried individuals earning the same income as consultants can end up paying as much as ₹3 lakh more in taxes, largely due to limited deductions under the new personal tax regime.

₹24 Lakh Example Shows Stark Difference In Take-Home Income

In her post, Meenal Goel compared two individuals earning ₹24 lakh a year- one as a salaried employee and the other as a consultant operating as a business. Under the salary structure, even after a standard deduction of ₹75,000, taxable income remains ₹23.25 lakh, translating into a tax bill of ₹2.93 lakh. By contrast, a consultant reporting ₹12 lakh in business expenses reduces taxable income to ₹12 lakh. Under taxation rules, this can bring the total income into the zero-tax bracket.

Meenal Goel wrote, “Salaried middle class is using this trick to save lakhs in taxes. High-income professionals are not drawing salary anymore. Instead, they are becoming consultants.”

Meenal Goel noted that a person earning ₹60 lakh as a salaried employee could pay over ₹18 lakh in taxes annually. If the same income is structured through consultancy, the tax outgo can fall sharply- in some cases to nearly half, depending on expenses and the business category.

Despite the financial advantages, Meenal Goel cautioned that switching to consultancy is not without downsides. Consultants forego employer-linked benefits such as Provident Fund contributions, paid leave, insurance and job security. They also take on higher compliance burdens, including GST registration, accounting and record-keeping.

“It involves more effort and responsibility,” she said, adding that operating as a business requires disciplined documentation to justify expenses.

Still, the potential for wealth creation is pushing more high-income earners to restructure their work arrangements, she said, concluding, “While the middle class sticks to the comfort of a salary slip… the wealthy are using consultants’ flexibility to build more wealth.”