Salary Breakup

Salary/Remuneration

• All remuneration including allowances, perquisites and arrears

of salary received by an employee from the employer or ex-

employer constitutes the salary income of an individual.

• Allowances directly add to an individual's monetary income,

while perquisites are in the nature of benefits, concessions or

facilities that an employee is privileged to receive

Components

• Basic Salary- • Dearness allowance• House Rent Allowance• Conveyance Allowance• Medical Allowance• Special Allowance• Incentives

Basic Salary

• Basic salary- Is calculated on your CTC i.e. 50% of your CTC is considered as Basic Salary

Dearness allowance

• DA is calculated on your Basic Salary i.e. 20% of your basic salary is considered as DA in your salary component

House Rent Allowance

• HRA is calculated on your Basic Salary i.e., 40% of Basic Salary.

Conveyance & Medical Allowance

• Conveyance is fixed at 800/- per month• Medical Allowance is fixed at 1250/- per

month

Special Allowance

• Special Allowance is the component after necessary deductions are done/ remaining amount is given as special allowance.

Deductions• PF- 12% on Basic + DA

– 12% of Employee contribution– 12% of Employer contribution

• ESI- 1.75% on Gross Salary-Employee contribution4.75% on Gross Salary- Employer contribution

( ESI deductions only if Gross salary is <=15,000/- Rs PM) ESI is calculated on the earning of individual

• Earnings include– Incentives– Bonus etc

Professional Tax

• PT- Professional Tax is deducted on Gross salary as per Karnataka Shops and Establishment Act

– 150/- Rs PM >10,000/-Rs and < 15,000/-Rs– 200/-Rs PM > 15,000/-Rs and< 50,000/Rs

Gratuity

Per Year • (Basic+DA)/ 12 months* 15days of earning/ 26 days of the

month

upon completion of 5 years you are eligible for Gratuity amount i.e., per year gratuity* no of years served in one company

Incentives • Performance Incentives• G1 and G2- 5% of Basic• G3 and G4-10% of Basic• G5 and Above management decision

• Constancy Bonus• 5% on basic for all the Grades• Constancy is paid upon completion of 1 year

• Loyalty Bonus• Upon completion of 2years- 10000/- Rs• Upon completion of 3 years- 20000/- Rs• Upon completion of 4 years- 40000/- Rs

Salary Break – up

Name XYZ  

Designation ZXY  

Grade 1  

ParticularsMonthly

CompensationYearly

Compensation

Basic Salary 3477 41724

Dearness Allowance 695 8345

House Rent Allowance 1391 16690

Conveyance Allowance 800 9600

Other Allowance 591 7090

   

Gross Salary (A) 6954 83448

   

Provident Fund Employer Contribution

501 6008

ESI Employer Contribution 330 3964

Performance Incentives 174 2086

Constancy Bonus 174 2086

Gratuity NA 2407

   

Total (B) 1179 16552

Total Cost To Company (A) + (B) 8133 100000

Net 6342.0

Thank You