Confused About Salary Deductions: How Does CTC Differ from TCTC in My New Job?

Hi All,

This is Reena Pujari from Chandigarh. I'm new to this forum but require your kind attention immediately. I've recently joined a company that is deducting 2016 (1008+1008) Rs from my total salary, terming it as EPF - Company contribution. This is the first time that I've come across such a situation wherein the company isn't contributing to my PF in any manner, instead of taking a share of my own salary and giving it back to me.

Can anybody differentiate between CTC and TCTC? :( Please respond at your earliest.

Thanks,

Hi,

Well, nowadays, since the concept of CTC is in vogue, therefore, usually, while fixing your salary, all these components are taken into consideration. CTC means Cost to Company, i.e., the total cost a company incurs on the employee. So obviously, the employer's contribution towards PF also becomes a part of it, that's why it is being deducted from your package.

Rolly

Hi Reena,

I do agree with Rolly. Nowadays, it's a common practice for employers to speak in terms of CTC. During the interview, they don't bother to explain the components of the CTC. In some cases, apart from PF, communication expenses incurred for official calls from the corporate number, which ideally should be reimbursed, are also included in the CTC. Even if an employee is traveling for an official purpose, they have to bear the traveling expenses as it's also a part of CTC. So, one should clarify all these issues before joining. All salary components should be discussed during the interview so that one will not feel cheated by the employer.

Regards,
Abhishek

My heartfelt gratitude to Rolly, Abhishek, and Lewis. Can I assume that I'm stuck with this double deduction until I'm with this organization? :( Is there no way out for me? Is it not that the PF deducted from the salary is returned doubled to the employee at the relieving time? Will the same apply in my case, or will the organization return my own money to me in the end? Then what benefit am I gaining by getting the PF.

Thanking you all once again for your very prompt reply.

Hi,

You will get all your money back (both yours and the employer's contribution) once you leave the organization, provided that the period is less than 10 years. After 10 years, the amount contributed towards the pension cannot be withdrawn.

The benefits that you receive include a good rate of interest and exemption on the amount contributed (your contribution only) in income tax.

Rolly

Hi,

It was interesting to read various reviews on the subject. In fact, in our organization, we also have a PF deduction of 24% on the Gross Monthly Salary. However, we decided to give the entire payslip details to the candidate, clearly informing them of the structure we have, and also explaining the deductions. We aim to be very transparent on this issue, making things easier for us.

Regards,
Ananda
Bangalore