Salary Format - CiteHR
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Hi Friends,
I\'m working as a hr for a new company, have to start payroll but we dint have deductions as of now, so please let me know how should i calculate salaries please gimme reply...
With Regards,
Suma patro.
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Dear Suma,

Each company having their own ways to calculate the Salary,there will be some fixed and some variable compnonets

Components of Salary Breakup

--> Basic Salary - The actual pay you receive for rendering services to the company. This is a taxable amount

--> Dearness allowance - A taxable amount, this is paid to compensate for the rising cost of living.

--> House rent allowance - 50% of salary (basic + DA) if residing in a metropolitan city, or else 40%

--> Conveyence allowance - Paid for daily commute expenses. Up to an amount of Rs 800 per month is exempt from tax.

--> Meal coupens

--> Telephone/Mobile bills

--> Medical allowance - Some companies offer medical care through health facilities for employees and their families. The cost of providing this benefit to the employee could also form part of CTC.

--> EPF - Employers contribute an equal 12% to the provident fund account.

--> Gratuity - Companies manage gratuity through a fund maintained by an insurance company.

--> Leave Travel Allowance - It is the cost of travel anywhere in India for employees on leave. Tax exemption if allowed twice in a block of four calendar years.

--> Insurance benefits

--> Fixed bonus - Paid on the basis of employee performance, either monthly or in most cases annually, it is a fully taxable amount.

-->Variable bonus - Complete bonus amount is paid only on 100% achievement of target, nevertheless it still is included as part of your CTC.

Regards,

Narayan


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