How To Calculate CTC? - Salary Calculate

Simta
Hi all,

I have queries regarding calculating CTC. Kindly assist me in this area, and if there is a formula available, please share it with me. For example, if the gross salary is 15k, how much will be the CTC for that individual? How can we calculate CTC? I look forward to a positive response.

Regards,
Simta
Amitmhrm
Hi Simta,

Yes, you have asked a very relevant question, but can you give us a CTC figure of which you have to prepare a break-up.

Anyways, the Basic would be approximately 40-50% of the gross, and 40-60% of that would be HRA. Conveyance Allowance is fixed at 800/- and is exempted from Tax. Medical allowance is 1250/-, which is also exempted from tax. LTA that you may put in gross or better leave it from gross that you may pay on actual. Other allowance is the remaining amount to complete the Gross salary, i.e.,

Other Allowance = Gross - (Basic + HRA + CA + Medical + Edu All)

So, we can say Gross Salary = Basic + HRA + CA + Med + Edu + Other Allowance.

Whereas, out of this, only two components may be deducted, one is PF, which would be 12% of Basic and ESI 1.75% of gross if only Gross is below 10,000/-.

Regarding TDS, with this financial budget, the ceiling has been increased from 1,00000/- to 1,10,000/-. I think Madhumita has explained that very nicely.

Above, I have explained only regarding the Gross/Month. Regarding CTC, you have to do some more exercise:

First Calculate Gross/Annum = 12 * Gross/Month

then add Ex-Gratia or Bonus in lump sum; it will now become AFGC (Annual Fixed Gross Cost).

Then Add PF contribution and ESI 4.75% of Gross if applicable from the employer side per annum then it comes to your CTC or ATC.

It means CTC = Gross/Annum + EX-Gratia + PF & ESI contribution.

If any other benefits are being provided from the company side, then you should also add them to conclude your CTC.

Hope it will be clear to you now. If you have any queries, feel free to revert.

Regards,

Amit Seth
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