How Can I Negotiate a Tax-Saving CTC Breakup for My New Job Offer? Urgent Help Needed

Hi,

I have just been offered a package of 30 Lacs as fixed with 5 Lacs as PLI (Performance Linked Incentive). I need the most tax-saving breakup of this CTC to negotiate with. The components mentioned are: basic, LTA, Med, car, Driver, Conveyance, special allowance, Med Insurance, PF, Gratuity, Bonus...

This is urgent. Please help.

Thanks

Dear Aditya,

I didn't understand your question! Can you please provide me with the correct question so that I can help you?

Regards,
Charvaka Reddy

Dear Charvaka,

I too pose a similar concern. My current consolidated compensation with my employer is 15 Lakhs. I work as a Chief Consultant. With a new opportunity, I am being offered a CTC base compensation. How much should I negotiate for? I am thinking of around 20 lakhs. What would be the total tax deductions per month and per year on 20 lakhs CTC?

Thank you.

Hello Seniors,

Please find the attached... hope it might help you.

[QUOTE=Roshni R; 1012721]
Hello Seniors,

Please find the attached... I hope it might help you.

Dear Roshni,

Thank you so much for the info. It is indeed very useful. I would appreciate if I can get some suggestions on expense heads which I can ask for to reduce tax liability.

Regards,
Aditya

Hello,

Expense Head includes Medical, LTA, Conveyance, Uniform allowance, Petrol reimbursement, Telephone/Mobile...

Dear Charvaka,

Let me elaborate. I need to know what can be the best net take-home salary in a CTC of 30 lacs. I have this offer and I need to make a decision based on the net earnings that I will take home every month, apart from other things. So, if you can break this CTC down into a monthly net package with the best possible tax savings by adding expense heads that are claimable on a monthly basis, it'll be great.

Hope this helps...

Regards,
Aditya

Hello,

Please find the attached CTC break-up for 30 lacs. Kindly revert. I have not calculated the IT part.

Dear Aditya,

Please find the attached file of tax calculations. Below are the details of tax exemptions:

- 80C - ₹1,00,000
- 80CCC - ₹10,000
- 80D - ₹40,000
- 80DD - ₹75,000
- 80DDB - ₹50,000
- 80G - Charitable Trust Fund 10% of Basic Salary
- House Loan - ₹1,50,000

Regards,
Charvaka Reddy

Gross salary: 2,000,000
Conveyance: 800
Medical allowance: 1,250
HRA: 3,500
Total Gross Salary: 1,994,450
PT: 200
Total Gross Salary: 1,994,250
80C: 100,000
80CCC: 10,000
Aggregate Deductions: 1,884,250
Loss of House rent property/house loan: 150,000
Total taxable income: 1,734,250
Tax payable: 424,275
Sec & higher education cess: 8,485.5 (14000 10%)
Education cess @ 1%: 4,242.75 (40000 20%)
Total Tax payable: 437,003.25 (370,275 30%)

Per month: 36,416.9375

Note: Under section 80C, 80CCC, 80D, House Loan, Vehicle Allowance, and House Rent, you have to submit the bills.

You can go for fixing basic on the higher side. This is due to HRA being calculated based on the basic salary, and the total HRA amount can be eligible for tax exemption. LTA and medical expenses can also be exempted. However, PLI is fully taxable.

Regards, Sunkanna.V

Hello,

Please find the Attendance Register.

Thank you for the same.

Also, if you can give me a brief idea about the salary breakup.

Regards

What is Ex gratia (INR), CCA (INR), and CONI (INR) in the salary structure? Please elaborate on how they are calculated. Please help...

Regards,
Devendra

Dear Roshini,

As per my knowledge, a bonus is different from ex gratia.

Regards,
Charvaka Reddy

Hello

Please chk
Bonus is the amount which is been paid to the employees.. after calculation of profits n all.. Whereas Ex-Gratia is an amount which is been fixed and paid at the time of Dipawali on pro-rata basis and its also included in the CTC.

1 Definition: An ex-gratia payment in this context is a payment made to an individual in respect of loss or damage to personal property in a situation where the County Council accepts no liability for the loss or damage but is willing to make some reimbursement without accepting liability. Most commonly such payments are made to employees in respect of personal property (including clothing or personal items such as spectacles) damaged or lost accidentally. Ex gratia payments are not made in situations where the loss is fully insured, either by the individual or the County Council

2. Funding: In the case of schools with delegated budgets, funding to make ex-gratia payments is included within the general delegated budget. There is no specific budget heading for this item as the payments concerned would normally be too small and infrequent to warrant specific provision. The decision as to whether or not to make an ex-gratia payment in individual cases rests with individual schools. Although this is not a matter for the Director of Education, in specific cases advice on practice may be sought from the County Council's Insurance Manager.

3. When to Consider Making an Ex Gratia Payment: Most claims are likely to be made by employees. These claims will normally relate to clothing or small personal items brought into school in the course of the working day. The loss or damage will normally be accidental. It does not have to be attributable to any fault or negligence on the part of the school and the making of an ex-gratia payment is not an admission of liability. Teachers' conditions of service (Appendix of the Burgundy Book) acknowledge that the school environment is one in which personal property might be subject to a greater than average risk of accidental loss or damage. They require schools to consider sympathetically any claims made by teachers in respect of loss or damage to property in the course of their job.

4. Making an Ex Gratia Payment: Ex gratia payments are intended to cover small losses. If a claim is made in respect of loss of more than £100 value, schools should seek advice from the insurance manager. If the object concerned is high in value, schools should consider whether or not is should have been brought into school in the first place, and whether it is or should be insured by the owner. Ex gratia payments are not intended to cover fair wear and tear. There should be evidence that the loss or damage is outside the usual areas such as spillage of food or drink, damage to vulnerable items of clothing, etc.

5. Motor Vehicles: The County Council does not accept any obligation to provide parking for employees' motor vehicles nor does it accept liability for loss or damage sustained while an employees vehicle is parked on County premises. The responsibility for insurance of a motor vehicle rests with the owner. Employees who use their vehicle on County business are required to have suitable insurance cover. Uninsured losses are (at least in principal) recoverable from any third party responsible for the damage. However, staff cars parked in school car parks may be at greater risk of suffering malicious damage by unknown persons and in such exceptional circumstances an ex-gratia payment may be appropriate. If, for instance, a school is satisfied that damage was caused maliciously in a way which relates to the teacher's (or other employee's) employment (e.g. by a pupil or parent) it should consider whether an ex-gratia payment is appropriate because the uninsured loss will not in practice be recoverable. The uninsured loss could include some compensation for loss of no-claims bonus or to help cover a reasonable excess in the employee's insurance policy.

6. Payments to People Who are Not Employees: In general ex-gratia payments will not be appropriate to people who are not employees. Contractors should have suitable insurance for themselves and their employees to cover such eventuality. Casual visitors such as parents or those attending school functions should not normally be considered unless there is clear fault on the part of the school, in which case the Insurance Manager should be consulted.. However, it may be reasonable to treat volunteers and school governors who have frequent business on school premises in the same way as employees.

7. Delegation: It is recommended that schools have a system which delegates to the headteacher the power to make occasional ex-gratia payments to employees - up to a specified amount of not more than (say) £100 on any one occasion and nor than a specified number of occasions in a year.

Dear All,

Please provide me with the CTC break-up for Rs. 31,000/- per month to maximize tax benefits. I have a Housing loan, Mediclaim Insurance, LIC policies, a car, a two-wheeler, 2 school-going children (kids), and am taking care of my mother.

Rajarajan

Dear Aditya/Roshini,

EARNINGS Per annum Amount per month amount Deductions Per annum Amount per month amount Basic Salary 1200000 100000 PF 144000 12000 HRA 480000 40000 PT 2400 200 Conveyance 9600 800 TDS 400000 33333.33333 Medical Allowance 15000 1250 Special Allowance 1185400 98783.33333 Books & periodicals 80000 6666.666667 LTA 30000 2500 Gross Salary 3000000 250000 Deductions 546400 45533.33333

Net salary 2453600 204466.6667

Please review the corrected formatting of the provided information.

If an employee's salary exceeds two lakhs per month, how can they save on income tax and by how much?

Thanks,
Rajnish
Human Resources
Proof of Performance Data Services Pvt Ltd