The Salary structure differs from company to company based on their C & B policies.
Components in the salary would be -
- Basic - 35% - 50% of Gross
- HRA - 40% of Basic for Non metro & 50% of basic for Metro
- Conveyance allowance - Maximum of Rs. 800 per month which is Max of Rs. 9600 P A
- Medical Reim - Rs. 1250 / PM which can be of Rs 15000 PA
- Special Allow - Balance of Gross will be provided as Spl Allow
Emp Contribution - 12% on Basic
Emp'r Contribution - 13.61% on basic
ESI - Applicable if the employees Gross Salary is less than or equal to Rs.10000 "editted" mistyped, ESI limit is Rs. 15000.
Emp Contribution - 1.75% on Grorss
Emp'r Contribution - 4.75% on Gross
Professional Tax -
Varies from State to State
CTC = Gross + PF (Emp'r Cont) - ESI (Employer's Contribution)
Net Salary = Gross - PF (Emp Cont) - ESI (Emp Cont) - PT
Gratuity = Basic *15/26 - It is payable to the employee who completes 5yrs of service in the organisation. It can be showed as a part of CTC.
If Employees coming under high Salary, you can split the special allowance into the following - LTA, Food coupons (Sudexo), Petrol and car allowance etc.
The percentage of Variable Pay also differs from company to company based on the C & B Policy.
Thanks for your reply however i still have a query.. My company is a Sole Proprietor ship firm in FMCD industry and here we dont have any deductions..The components in the salary structure is the Basic (50 % of gross) + HRA ( 30% of gross) + Conveyance of 800rs per month and 5% deduction of Bonus and the balance of the CTC is given as Other allowance. There is no gratuity , no PF, no ESIC and no PT . ( PT is not included since our unit is located in Tax free zone.. Are there any mandatory changes to be made according to the law..Please advice.
Your firm will be applicable for PF and ESI as pet the law.
EPF, if the minimum employees are 20 and above
ESI, if the minimum employees are 10 and above.
TDS may be deducted if your firm falls under audit, incase if your turnover is more than 50 lakhs.
I would like to make small change in TDS
- There is no criteria of Audit in case of Salary whether firm is proprietary, partnership, Company or whatever. TDS on salary is applicable for every entity.
- If turnover of proprietorship firm exceeds Rs. 60 Lakh in case of Business or Gross receipt of Professional services exceeds Rs. 15 Lakh. In this situation TDS on other services is applicable from next year.
For your kind information :
1) Profession Tax is applicable for all the employs earning 10,000 and above per month
10,ooo - 14,999 will charge 150rs
15,000 and above will charge 200rs
2) It is mandatory that there is no minimum number of employs required for PT . Hence it is applicable for each individuval.