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Salary computation percentage

RSUDHAKAR Started The Discussion:

Hi Folks

Could any of clarify my doubt on the following

What Should be the basic % in a CTC

HRA should be At what % of Basic
Da should be at At what % of Basic
HRA should be At what % of Basic
CCA should at what % of Basic
Gratuituy %
Super annuation %

Is leave encahsment is taxable, if so at What %

and what is the process of TAX deduction and what is its limit in every account

Kindly clarfiy my doubts

With Regards
R.Sudhakar

Rahul Kumar - Contributing Member
Hi Sudhakar,

The compensation structure may vary from Co. to Co. and industry to industry due to type of skill requirements, demand-supply scenarios and industry specific norms (sometime set by quasi-legal boards).

But, very generally, you could follow this :

Basic : 30 - 35% of CTC
HRA : 50% of Basic
DA : Regulated by Govt. notifications (nominal amounts)
CCA : Is normally a filler on negotiated salary (put the balance amount in
this). Otherwise, 30% of CTC
Gratuity : Is statutory (consider 4.81%)
Superannuation : 15% - 27% of basic (27% if there is no PF)
Leave Encashment : Taxable under provision of IT Act.

Tax deduction is based on various things like HRA claim (least of the 3 conditions under the IT Act - could also be non-taxable if claimed properly), investments done by employee, attraction of 80C/cca, (basic, cca fully taxed based on IT slabs), etc. Please refer to the IT Act (direct taxes) or your Finance deptt for more details..)

The above comp. structure can be tweaked or more components added based on the Co's requirements. That needs a discussion.....

Hope the information helps.

Rahul
09968270580






Hi Folks

Could any of clarify my doubt on the following

What Should be the basic % in a CTC

HRA should be At what % of Basic
Da should be at At what % of Basic
HRA should be At what % of Basic
CCA should at what % of Basic
Gratuituy %
Super annuation %

Is leave encahsment is taxable, if so at What %

and what is the process of TAX deduction and what is its limit in every account

Kindly clarfiy my doubts

With Regards
R.Sudhakar

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