1. I presume, you mean to say Rs.26000 is the gross salary, which might inclue Basic pay, HRA & other allowances. No one can say the basic pay should be Rs.21000. It’s your Co. policy & discretion.
2. What’s this Hostel Allw. Normally applicable to Interns or Trainees who are generally paid stipend or some consolidated salary. Paying HRA whilst Hostel Allw. not likely to arise. However you should elaborate the story behind these so that we can give our opinion.
3. Medical Allow and Conveyance Allw.- These also not a compulsory components of one’s emoluments. It depends on your Co’s policy. However if your employees are covered under ESI then payment of Medical allow. won’t arise. Similarly payment of conveyance allw. also may not arise if – i) Co’s conveyance is provided or ii) gross salary includes conveyance allw, but not shown separately.
Some employers allow reimbursement of conveyance exp. either at fixed rates or at actuals for travel on business trips.
4. Edu.Allw: Also not a compulsory component. But some employers break the total salary into various allowances including Edu.allw for those employees having children (may or may not be limited to two children) who are studying. There is fixed rates under any law. Edu.allw. is based on Tuition fees, hostel fees for those children staying in hostels, books etc. It depends on Co’s policy.
5. Special allow.- This quantum of salary component is not attached to any specific aspect but to cover the balance of emoluments agreed upon as gross salary or CTC. Here you have to note, as per the recent judgment of SC this part of allow. called as ‘Spl.allw’ should be included for the purpose of computing PF contribution. Therefore you should be aware of this fact while determining the components of gross salary/CTC.
You have not attached any ‘salary’ sheet for our review. If you do that we may suggest corrections if any.
For your ref. models & explanations are attached which is useful to you.
24th July 2019 From India, Bangalore