Salary Breakdown Needed: How Can I Ensure a 20K Monthly Take-Home Pay?

Friends,

I need to know the salary structure in order to receive/give 20k per month in hand. Please let me know if you need more details. Hope you will be able to find some time amidst your busy schedule to respond.

Thank you.

Hi,

You can allocate 40% as basic salary, 30% for House Rent Allowance (HRA), 20% for a special allowance, and the remainder for conveyance.

For more details, please email me or submit your query to my ID dmshamli.

Regards! :D
Deepak

Deepak,

Please let me know what should be the gross CTC. I would appreciate it if you could send me the complete salary structure.

Thanks

Hello,

The contents of the salary breakup are as follows; you can prepare it according to your own preference. HRA would be 50% or 60% of the basic salary.

- Basic
- HRA
- TA
- Other Allowances
- Mobile Reimbursement per Month
- Gross Per Month: Sum of all the above
- Gross Per Annum: 12 times Gross/Month
- PF Contribution: 12% of Basic/Annum
- ESI Contribution: 4.75% of Gross/Annum
- Medical: The mediclaim facility is provided to employees not covered under ESI, as the maximum ceiling for ESI is 10,000/month. Amounts exceeding this will be covered under Mediclaim or as per company policy.
- Ex-Gratia/Bonus: A fixed bonus amount
- Annual Fixed Gross Cost: Gross/Annum + Ex-gratia
- Annual Total Cost: AFGC + PF + ESIC
- Annual total cost is also referred to as CTC.

I hope this clarifies the information for you. If you have any queries, feel free to ask.

Regards,
Amit Seth.

Dear Friend,

You have provided a good explanation. Could you please calculate the same for 20k and the CTC so that it will be very clear? Kindly do the needful, please. Furthermore, we can discuss what is taxable in the pay structure within the limits.

Thanks,
Dennis

Hi,

Just see this salary break-up that I use; it may be of some help to you. Change the figures in the Annual entitlement column, and the rest will change accordingly.

Cordially,
Preet

Thanks to everyone for their efforts. Preet, thank you for uploading the sheet. However, I am still unable to get the right answer. As I have written in my earlier post, the Net Monthly Salary payable must be 20k. So keeping in mind this figure, how do you give breakups? I mean to say the employee must get 20k in hand/take-home salary. Now, I need Basic, HRA, TA, Conveyance, and other components in order to make the Net Monthly salary 20k. Please let me know if any of you experts need more clarifications. Thank you.

Dear Yusuf,

Everyone has given their best efforts to prepare the same; you only need to adjust the figures according to your requirements. Anyways, you may refer to this structure as well:

Salary Head Amount
Basic 8000
HRA 4800
TA 800
Medical Reimbursement 1250
Other Allowance 6000
Gross Per Month 20850

It is more than 20k because if you have to deduct the PF amount, then it will be around 780 rupees if calculated on the ceiling, i.e., 6500 basic salary. So, after that deduction, it will be in accordance with your requirement of 20k in-hand or take-home salary. Hope this helps you reach your solution.

Regards,
Amit Seth

Amit Bhai:

Thank you for your response. I will review your structure and let you all know if further assistance is required.

Thank you.

Hello,

You were to just change the figures in the Annual Entitlement column to reach the desired amount. I have done so for you and am uploading the second sheet.

Now, some of the figures for administrative purposes are not provided as monthly entitlement but as yearly or quarterly entitlements. Altogether, we are close to 20K. The choice lies with the company; it can also be provided monthly.

Cordially,
Preet

Dear Yusuf,

Here is my breakup; you can also try this:

Basic 9000/-
HRA 4500/-
Conveyance Allow. 800/-
Education Allow. 200/-
Medical Reimbursement 1250/-
Special Allow. 5330/-
_________
Gross salary------------- 21080/-
P.F. --------------- 1080/-
___________
Net Salary in hand------ 20000/- ___________

And, let me know if it'll solve your problem or not.

Regards,
Soma

Dear Soma,

I appreciate your effort. I believe you didn't add the PF amount in Gross. As per my understanding, both Employees' and Employers' contributions of PF must be added to Gross CTC, and later, Employers' contribution must be deducted to get NET Salary/Take-home salary/In-Hand Salary. Please correct me if I am wrong.

- Yusuf

Hi KK,

Thank you for your spreadsheet. If you look at the previous answers given by other experts and spreadsheets uploaded by Preet, you will not find a few components like Gratuity. I am not sure if it has to be included in Gross CTC. Please comment.

- Yusuf

Hey,

Can you try this on an Excel sheet? Include basic, HRA, conveyance, special, medical, and all other components. For HRA, calculate it as 60% of the basic salary. Set standard amounts for basic and conveyance, e.g., $800 and $1250, respectively. Special allowance should be 125% of the basic minus the conveyance, etc.

Additionally, you can factor in PF, gratuity, EDLIS, and other deductions to determine the final amount.

Regards,
Anish

Hi Yusuf,

You are very correct that the employer's contribution to PF gets added to the Gross CTC. However, it is only the employee's contribution to PF that is deducted from the gross monthly salary. After this deduction, the net payable salary is calculated.

Regarding Soma's post, she provided you with the salary break-up of the gross monthly amount, which is why she did not include the employer's PF contribution in your salary details. As for the employee's contribution, since it has already been included and deducted from your basic salary, there is no need to add this contribution again to the CTC.

I hope this clarifies your query regarding the salary breakdown.

Regards,

Amit Seth

Dear Yusuf,

Sorry for the previous error. Amit is right. I have given only you employees gross p.m salary break-up, which includes employee PF part. If you deduct employee PF, you'll get a net in hand of 20k p.m.

See:

Gross = Basic (includes PF) + HRA + Conv. + Allow.
Gross CTC = Gross + Employer PF cont.
Net in hand = Gross CTC - (employer PF cont. + Employee PF cont.)

I hope this resolves your query regarding the salary. If you still have any queries, please write.

Regards,
Soma

Dear Soma,

Thank you for your post. To be very frank with you all, I am now very much confused about this PF stuff. If you look at Amit's last post, he says only employees' PF contribution must be deducted to get the net figure, whereas your last post says "Net in hand = Gross CTC - (employer PF cont. + Employee PF cont.)".

Can you please squeeze some time amid your busy schedule and send me a spreadsheet filled with figures as per the 20K requirement? I would appreciate your response.

Thank you,
Yusuf

Hi Preet, great work! I just wanted to know, under the monthly entitlements head, why is the basic salary divided by 24? Maybe a silly question, but it would help if you replied.

Regards,
Kunal