Katyana
Hr Professional
Suni_shinde@rediff.com
In Smartworking
Chanchal411
Hr Manager
Nayagam.sp
Sr.manager-resources
Imtiaz
Recruitment
Ms14
Salaried
SwatiSS
Hr Professional
Maveryq
Marketing Engineer
Alexferns
Logistics
Tsrao123
Asst. General Manager
Sunilprem
Gm Hr & Admin.
Shukla3040
Executive
Abdulsar
It Recruiter
Alap1983
Executive Hr

Thread Started by #imtiaz

hi all
i hav one very basic doubt as i never calculated salaries now i have to pay salary to one of my employee working in saudi arabia.
his salary is 58333 and he strted working frm 6th may 07 so how much will be his salry for may 2007?
8th June 2007 From India, Hyderabad
Hi Imtiaz!
I can let you know what we do in our company.
Suppose the person's salary is X
# of working days is 27 (we have this for workers) or 31 (we have this for management). You choose what ever you have in your company.
So you can use the formula:
((X/31)*(31-6))
We make all calculations based on this.
Regards,
Swati

9th June 2007
Hi,
His monthly salary is 58333, right........
you can first calculate his per day salary which will be 58333/31 and that comes to 1882Rs.
and now, you can calculate this into number of days present, i.e. payable days- which will be 1882*26 = 48932.
this will be amount wil be given to him.....
9th June 2007 From India, Thana
Hey !
for same example : he joined on May 7th , Hence you would need to pay him for 25 days .
Caluclutae his salary per day : Monthly salary discussed as per Offer letter / No of days in this month will give you a day's salary .
Hence in this case 58333/31 will give you one day's salary which is equal to
1881. 70 . Now caluclate for 25 days ok 1881.70*25 = 47042.74
You gotto pay him 47042 before deducting Professional Tax/TDS/Income Tax.
Any questions let me know
Cheers,
Gayathri
4th July 2007 From India, Hyderabad
Dear Reena
Every company has a different salary constituents. However I give an example of what a normal CTC components may look like. I have an excel sheet that will help you to calculate roughly your take away salary.
just fill in the CTC, Professional tax & the Income tax columns.
Regards
ms
29th February 2008 From India

Attached Files
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File Type: xls salary_calculator_111.xls (17.0 KB, 1269 views)

Hi MS,
Could you please help me with the salary Breakup of Rs.5.50 Lakhs p.a.
This is the annual salary. There is also a Performance incentive of up to Rs. 2.0 Lakh per year.
Kindly suggest a salary breakup so that my tax outgo can be minimised as much as possible. I have a home loan and am servicing an emi also.
Thanks
Jitendra
1st March 2008 From India, Calcutta
Hi,

You can have this kind of breakup to save tax:

CTC 5.50 L-PA

BASIC--35% OF CTC--Fully taxable

HRA-50% OF BASIC IF IN METRO AND 40%OF BASIC-IF IN OTHER CITY(exempted upto certain limit on submission of rent receipt for 3 different months)

CONV. ALLOW:exempted upto Rs 800/pm

SPL ALLOW:REMAINING BALANCE OF CTC--fully taxable

ANY INCENTIVE--FULLY TAXABLE

LTA--EXEMPTED TWICE IN A BLOCK OF ANY FOUR YEARS

REIMBURSEMENTS

NEWSPAPER & PERIODICALS--EXEMPTED SUBJECT TO SUBMISSION OF BILLS

MEDICAL EXPENSES:--EXEMPTED UPTO RS 15,000/SUBJECT TO SUBMISSION OF BILLS

DRIVER SALARY--EXEMPTED SUBJECT TO SUBMISSION OF BILLS

VEHICLE MAINTENANCE---EXEMPTED SUBJECT TO SUBMISSION OF BILLS

PETROL--EXEMPTED SUBJECT TO SUBMISSION OF BILLS

MEAL VOUCHERS--FULLY EXEMPTED

MEDICAL REIMBIRSEMENTS--15,000/PA--TAX EXEMPTED

BELOW IS THE SAMPLE BREAKUP OF RS 5.50 L P/A

BASIC--192500

HRA---96250

CON ALLOW--800

SPL ALLOW--

REIMBURSEMENTS

NEWSPAPER--1000

PETROL--5000

DRIVER--5000

VEHICLE--6000

MEDICAL--1250

LTA-ONE MONTH OF BASIC

MEAL VOUCHER-2400



If u any further queries, just let me know.

KATYANA
2nd March 2008 From India, Gurgaon
Hi Katyana, Thanks for your help. Would it be possible for you to help me out with the salary break up. My email Id is wordsmyth at rediffmail dot com Thanx Jitendra
14th March 2008 From India, Calcutta
My Company is new. Salary structure is to be modified. The heads in use are:
Basic Salary, HRA, City Compensatory Allowance, Conveyance Allowance, Fuel & maintenance Reimbursement, Chauffeur Allowance, Car Lease / Laptop reimbursement, Other Reimbursements, Children's Education Allowance, Special Allowance, LTA, Medical Reimbursement, Bonus Pay, Performance Pay (fixed component, but payable annually), Employer's PF Contribution.
Company Car plus fuel plus maintenance - (mentioned in case of certain employees)
Other remarks on the Salary slip are:
All taxes and deductions are applicable as per Government Regulations.
Benefits are applicable as per Company Policy.
Work Tools - SIM Card for Mobile. Laptop
Please advise on the following:
1. Are these heads correct?
2. What all heads form part of the Gross Monthly Salary?
3. Which heads do not form part of the Gross Monthly Salary, but are included in the Annual CTC?
4. Any other observations.
Thanks!![/list][/list]
15th March 2008
Dear Katyan
Thank you very much for your valuable contribution on Cite HR.
May I clarify one thing from your designed salary break-up that if we put some specific amount in the head of Petrol & Driver Re-imbursement than whoms name should a car either employer or employee name.
Please clarify.
Thanks
Defender Kr. Sharma
15th March 2008 From India, Delhi
Hello HR professionals,

We are a USA manufacturer, starting a manufacturing unit in Gujarat- and are not versed at all about certain salary practices. Our MD in India has advised that when we offer gross annual salary to our employees in an appointment letter, we should break it down in several classes (Base Salary, Housing Allowanace, Car allowance, Vacation allowance, book purchase, Medical benefits etc.) This is done- we are told- so that the employee has less severe tax consequences.

Our USA president (me) is originally from India- so is our USA HR Manager (Archna Dhingra). But we are not much knowedgable (pretty ignorant as a matter of fact)in this matter.

Can someone educate us on the following:

1. If we hire a Production Supervisor-say, at a salary of Rs 20,000 per month, what categories should we break this salary?

2. Are there any guidelines as to what percent to apply for which class? (such as 15% for Housing- etc)

3. Can someone point us to web-sites, article etc on this subject.

4. We are going to provide housing to some key managers and cars to some others. How do we apply the break-down to them?

5. If we give medical allowance or vacation allowance, do we need to ask for proof of expense? Does this not encourage submission of fake bills?

Thanks a lot for your kindness in sharing your knowledge and wisdom.

-Rahul Shukla

President/CEO

S.S. White Technologies

Piscataway, NJ, USA

www.sswhite.net

e-mail:
16th March 2008 From United States, Hoboken
Hi Devendra,
Whenever we talk about " Reimbursements", it always implies that all the reimbursements should be in name of " EMPLOYEE AND NOT ON EMPLOYER,S NAME" because employer is giving all those to save tax of an employee.
Hope now the concept is clear to u.
KATYANA
16th March 2008 From India, Gurgaon
Hi
can you pl amplify the terms mentioned in the salary calculation format
e.g TA,FEP,MA etc
also can you confirm the percentage applied for each head
can you give me salary caculation for
a) 15000,
b) 18000
c) 50000
d) 70000 & 75000
so to enable the employee to save & reduce their tax burden
pl guide me
regards
16th March 2008 From India, Mumbai
Hello Friends,
After posting my questions on salary structure, I searched the archives and found answers to most of my questions. This is a great website- and many of you have selflessly posted articles, spreadsheets etc. I wanted to send a thank-you e-mail to some of you- but it seems I cannot yet- until I make 5 postings.
So here is a general Thanks to all of you great guys.
-Rahul Shukla
SSWhite Technologies, USA

17th March 2008 From United States, Hoboken
The above mentioned Salary Calculation is ENTIRELY WORNG.

No offense.

As per above method let us take an example of Person whose salary has been decided as 10,000/-

Further for complete clarification let us assume he has taken single Leave Each in Month of January (31 Days) & April (30 Days) & February (28 Days)

As per "gayathri.suraparaju" suggestion:

Per Day Salary in January: 10,000 / 31 = 322.60

Per Day Salary in February: 10,000 / 28 = 357.14

Per Day Salary in April: 10,000 / 30 = 333.33

Therefore it means your Per Day Salary varies Per Month!!!!!!!!

Hence, The Person's Salary (after deducting only Leave) will be as follows:

Salary For January: 10,000 - 322.60 = 9677.4

Salary For February: 10,000 - 357.14 = 9642.86

Salary For April: 10,000 - 333.33 = 9666.67

Even though he has taken only single day off, there will be huge difference in Salary in particular months.

HENCE Correct Salary Calculation should be:

Monthyl Salary = 10,000

Total Days in Year: 365

Hence Per Day Salary = 10,000 * 12 / 365 = 328.77 (Constant Value, Non-Variable)

Therefore the Person's Salary for individual Months IRRESPECTIVE OF CALENDAR DAYS will very only if Person Takes a LEAVE. NOT OTHERWISE!!

I Hope Salary Calculation will be a lot simpler Now.

Alap Desai
18th March 2008
Hi Katyana,
Your help has been invaluable.
I am grateful for your help in this regard.
My questions are as follows:
1. I won't be having a vehicle, so the driver , petrol and vehicle reimbursements go out.
2. In the changed circumstances, can I have a higher allowance as communication allowance , books and periodicals allowance, or entertainment allowance.
3. I would be grateful if you could suggest a structure with the least tax outgo.
Annual Monthly Taxable
BASIC SALARY 264,000 22,000 264,000
HOUSE RENT ALLOWANCE (HRA) 158,400 13,200 132,000
TRANSPORT ALLOWANCE 9,600 800
SPECIAL ALLOWANCE 33,000 2,750 2,750

Total (A) 465,000 38,750 398,750

COMMUNICATION REIMBURSEMENT 36,000 3,000 -
LTA 22,000 -
MEDICAL REIMBURSEMENT 15,000 1,250 -
BOOKS & PERIODICALS 12,000 1,000 -
Total (B) 85,000 7,083 -

Annual CTC (A + B) 550,000 45,833 398,750


Is the above split adequate with reference to Income Tax outgo? Or can it be done better.
Thanks and regards,
Jitendra
19th March 2008 From India, Calcutta
Hi Katyana, The above post is a bit jumbled up. I am attaching the excel file. Kindly go through it and make the any change that you feel will enhance the take home component. Thanks. Jitendra
20th March 2008 From India, Calcutta

Attached Files
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File Type: xls salary_structure_146.xls (19.0 KB, 372 views)

Hi, Can I have a standard format of Salary Annexure with fixed and variable components? nayagam
24th March 2008 From India, Madras
Hi All, Would be grateful if you guys could suggest if the salary breakup is good. Can it be tweaked? What would be the income tax outgo ? Thanx JRC
25th March 2008 From India, Calcutta
Friends,
I have to develop the package structure in my company. What is the method followed for dividing the salary in to various components. Example if we fix a salary of 6 lakhs what should be the Basic, HRA and other allowances. Are there any legal terms we need to comply. Also please help me in LEAVE structures. How many CLs and PLs will be allowed and any statutory laws to be followed. I am working for a US consulting company in Hyderabad.
Regards,
TSRao
25th March 2008 From India, Hyderabad
Hi All,
This is Abdul, could you please help me in break up in salaries, currently i am working in ITES company, Bangalore. i have to break up the salary of one candidature whose CTC is 3.6 lakh / Annum.
Could you please help me out.
Regards,
Abdul
26th March 2008
Dear sir i want complet solution on salary breakups how to prepair at what percent we have to calculate the salary ? i hope u will do the needful... thanks sunil
20th December 2008 From India, Bombay
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