Basic salary calculation formula - pf liability.. CiteHR

saurdeep Started The Discussion:

Hello there, Kindly help me with basic format to calculate Salary (%wise,basically break up) for the employees. Thanks & Regards, Saurdeep.

kanikawadhwa -  Member Since: May 2008
Basic is either 50% or 60% of the Gross salary... depends if you want to escape from PF liability.. and rest of the entitlements are calculated accordingly..

bsn -  Member Since: Nov 2007
Hi there too,

Just sharing my experience during my employment as HR in some companies. I used 3P method that is paying someone using 3 criteria :
- Performance (paying people by his/her performance, we get it from annual performance)
- People (paying people by his/her competencies - KSA (knowlede, skill and attitude)
- Position (paying people by his/her position, example : manager, supervisor, CEO, etc)

Radhika_hr -  Member Since: Aug 2010
Can i get the complete breakup of salary with % deductions. If i want to prepare the salary statement for 5L/Per annum for a employee.plz send me basic%, PF%, TDS%,HRA%, DA%, TA% and CCA%.

Plz send me the complete details.

Awaiting for response.


Syed_4u -  Member Since: Jul 2010
Hiii All,
The Basic calculation that is normally followed is:
If the Salary is 2.4lakhs pa, Then monthly Salary will be Rs.20000, Then....
Basic Pay: 40% of Gross Pay
HRA: 50% of Basic Pay
Medical Allowance: Upto Rs.800-1000
Other Balance amount will be considered as Allowance in calculation.

For getting your Take home or Net pay deductions like PF and others has to removed from basic pay......


HR_venki -  Member Since: Nov 2009
Dear all,

There is no certain % for spliting the gross wages like basic, HRA, CCA and any other allowance which is part of wage.

its totally depends upon the companies interest. Generally basic % will be decide in view of the companies employer PF contribution.



surajb -  Member Since: Oct 2008
Very True Venki,

Radhika/ Saurdeep,

Companies that want to avoid long term liabilities normally give very less basic salary as it helps them save money. (Less P.F to be paid). The H.R.A again would depend from city to city and so would C.C.A. Each company has its own salary structure and it would be advisable for you check on a few salary break-ups and then may be get a combination of them whichever suits your company policy.


Suraj Bhandare

kicchagee -  Member Since: Feb 2010
Pl. guide me whether the PF Act prescribes specific % of Gross Salary as Basic and DA? or even other salary components? If so, pl. specify the section Warm Regards, S.Gopalakrishnan

gopikrishnan -  Member Since: Aug 2010
dear all can i get reimbrushment of mobile bill i want format mail any one help me Thanks gopi -  Member Since: Mar 2009
Dear saurdeep,

please find below example -

Salary Details –

Basic Salary : Rs. 3,000.00
House Rent Allowance : Rs. 1,200.00
Medical Allowance : Rs. 1,250.00
Conveyance : Rs. 800.00
Special Allowance : Rs. 3,750.00


Performance Incentive : Rs. 0.00


Gross Salary (A+B) : Rs 10,000.00
__________________________________________________ _______________________________

Basic Salary = Gross Salary * 30%
HRA = Basic Salary *40%
Medical Allowance = Fixed
Conveyance = Fixed


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