How Do I Break Down CTC into Basic Salary, DA, Gratuity, and More for My Small Surgery Center?

Hello, I have a small surgery center employing 15 persons. Can anyone help me with how to calculate components like basic salary, DA, gratuity, PF, EPF, etc., from the CTC? What is the breakup in percentage?

Hello, dear!

Here I am attaching a salary calculator, which will help you solve problems and understand the concept of salary breakdown briefly.

All the best and happy calculating.

Dear Satish,

Salary Calculation and Labor Laws

Regarding salary calculation, we have to follow the rules laid down in labor laws, which may vary from state to state. In Karnataka, we have to adhere to the rules of the Minimum Wages Act of Shops and Establishments. This act specifies the wages to be paid for each designation. Likewise, if the establishment is located in a state other than Karnataka, please refer to the labor laws of that state to determine the category your establishment belongs to. Based on that, you can easily determine the appropriate wages.

Thank you.

Best regards

Dear Mr. Narinder Rathore, I am the accounts officer in my company and presently looking after the HR department in the absence of HR. Kindly advise me on how to bifurcate the total CTC amount of salary into the following heads: Basic, HRA, Special Allowance, and Conveyance. If the CTC amount is 55,000/- per month, I have reviewed your attachment, which is good, but the Special Allowance amount is not shown. I am eagerly awaiting your reply.

Regards, Bablu Kumar Jha [Email Removed For Privacy Reasons]

Hi Narendra ji, Thank you very much. This is very useful for small businesses and professionals. I had some questions:

a) The basic has been calculated at 60% of CTC and HRA as 40% of basic. What are the considerations for this?

b) Why is conveyance shown as NIL up to a 12,000 salary? What are the considerations for this?

c) Is PF calculated at 12% on BASIC 6500 correct?

d) Why is ESIC shown as NIL when the statutory limit is Rs 10,000 gross (now raised to 15,000 gross)?

e) How is the PF contribution of employees shown as NIL up to 10,700 gross?

f) How is gratuity calculated at 4.81%? We calculate it at 4.165% of the present gross.

g) Why is CCA, special allowance shown as NIL? We have been advised to break up the salary to have some amounts on this so that PF is not deducted on the amount and the take-home for the employee increases.

Thank you very much for your time. I would appreciate some clarity on my post.

Thank you a lot again, Rajiv Aundhe

Hello all, thanks, Mr. Narinder, for sharing the valuable information. I had a few queries regarding the calculation of basic pay. What is the criteria for deciding basic pay as 30%, 40%, or even 60% of the CTC? What is more advantageous for the employers - basic pay at 30% of CTC or 60% of CTC, and how?