There are no standards in terms of percentages. Normally, 40% of the CTC may be apportioned as Basic salary. The higher the basic salary, the more advantageous it is for employees as it allows for a greater contribution towards PF and other retirement benefits. For non-metro areas, 40% of the basic salary can be designated as HRA, while in metro cities, 50% of the basic salary is allocated as HRA. This HRA is tax-exempt for the amount exceeding 10% of the basic salary, provided rent receipts are submitted.
Conveyance allowance - Rs. 800/- per month (tax-free, no proof required), Medical - Rs. 1250/- per month (tax-free subject to production of bills), Child Education Allowance - Rs. 100/- per month per child (maximum 2 children, tax-exempt), Food coupons - Rs. 2700/- per month (tax-free in FY 2011-12), Gift vouchers - Rs. 5000/- per annum (tax-exempt). Any remaining amount may be categorized as a special allowance.
PF - 12% may be deducted from the basic salary towards employer contribution if it is part of the CTC.
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