What should be my ctc

Gross Salary Net Salary Gross Salary is the amount of salary after adding all benefits and allowances but before deducting any tax Net Salary is the amount that an employee takes home An individual's gross salary includes benefits like HRA, Conveyance Allowance, Medical Allowance etc. It is also known as Take Home Salary. What is the difference between Basic Salary and Gross Salary?

Basic Salary Gross Salary Basic salary is the amount paid to an employee before any extras are added or taken off. It does not include any allowances, overtime or any extra compensation Gross Salary is the amount of salary after adding all benefits and allowances but before deducting any tax For Example: An employee has a gross salary of Rs. What is Cost to Company? Gross Salary. Deductions from Gross Salary To calculate Income Tax, gross salary minus the eligible deductions are considered.

Please note: The taxation process is different for self-employed and salaried individuals. Gross Salary under Section 17 1 As per section 17 1 , salary includes the following amounts received by an employee from his employer, during the previous year.

Wages Any advance of salary Any fees, commission, perquisites or profits in lieu of or in addition to any salary or wages The contribution made by the Central Government or any other employer in the previous year, to the account of an employee under a pension scheme, referred to in Section 8OCCD.

Read More About Tax. Income Tax. Tax Forms. Service tax. Commercial Tax. Tax Sections. Road Tax. Property Tax. The allowance only covers railway ticket prices and airfares. Section 10 5 of the Income Tax Act, offers tax exemption on the LTA amount for up to two holidays in a four-calendar-year block. You need to submit proof of travel to receive the tax benefit.

This is a fixed amount your employer may pay above your basic salary. The Special Allowance varies among companies as it depends on multiple factors. Moreover, it is fully taxable.

Bonus is a component of the gross salary that the employers may pay as a performance encouragement. The entire bonus amount is fully taxable.

It is generally a mandatory savings scheme. Moreover, your employer matches your contribution and invests the same amount in your EPF account. It is a mandatory tax you need to pay to the state government. If the breakdown seems complicated, you are not alone. Calculating the salary can be tricky because it entails several aspects. To save time and effort, most people use the salary calculator in India. The tool can make the process easy for you; read on to know more.

A take-home salary calculator is an automated tool that helps you figure out your net salary after taxation. It also considers all the bonuses and deductions applicable. You must provide the gross salary and total bonus. The calculator will then determine the CTC and show you the amounts of basic salary, HRA, other allowances, deductions for provident fund and professional tax, total deduction, net salary, income tax, and net salary after income tax deduction. As the salary calculations involve various components, you need to use different formulas to calculate each aspect.

Only then you can estimate your take-home salary. Here are some important formulas you must know. The process to use the salary calculator is quick and simple. CTC contains all monetary and non-monetary amounts spent on an employee. All the below mentioned are a part of the in-hand salary, and therefore, are a part of the CTC pay as well. A major part of CTC comprises of compulsory deductibles.

These include deductions for provident fund, medical insurance, etc. But it definitely increases the CTC. Ben Davis June 1, How do you put CTC on a resume? What is current CTC in resume? What is CTC in job application? What is current CTC for fresher? How much CTC will I get? What is the take home salary for 20 lakhs?

What percentage of CTC is in hand salary? What is CTC and in hand salary? Which is better CTC or gross salary? How do you calculate CTC at home? How do you calculate CTC break up? What is basic CTC salary?