Confused About My Salary Slip: Why Does My CTC Seem Higher Than My Take-Home Pay?

Dear Sir/Madam,

I am confused about my CTC and salary slip. I am working as a network engineer in an industry for 1 year. My basic is 8000, on this, 32% HR = 2560 + Conveyance & Special Allowance = 2600. So, my gross comes to "12560". After a deduction of 960 P.F & 125 P.T, my net salary is 11485. This is approximately my salary every month.

Now, my question is, according to this calculation, my CTC should be around 1.2 or 1.5, but my company declares it as 1.9. How? When I ask them, they say there are several deductions that we cannot show.

Thanks a lot in advance, Rudhira

Dear Rudhira,

The figure that you have provided of your salary break-up shows that it amounts to around rupees 13,160 per month. After deductions of PF and P.T amounting to rupees 960 and 12, respectively, the gross salary in hand would be around 12,075.

Upon including all components in your break-up, it would total approximately 1.7 CTC. The breakdown is as follows:

- Basic: 8000
- HRA: 2560
- Other Allowance: 2600
- Gross Per Month: 13160
- Gross Per Annum: 157920
- PF Contribution Employer: 11520
- Annual Total Cost: 169440

I hope this information is satisfactory for you. If there are any other hidden components, the total might reach 1.9, possibly including Insurance and Bonus as well. Otherwise, it is the responsibility of the HR person to provide you with the breakdown of your salary.

Regards,
Amit Seth

As per your details, you yourself have given a wrong figure because as per your figures, your gross comes to 13160 and not 12560. Anyway...

The slab you have mentioned for P.T doesn't exist. 125 doesn't come in any slab. I could help if you could just attach your payslip (if you don't mind). The hidden deductions are PF on leave, leaves per month, PF on admin, etc., but they don't amount to much. Tell your HR to disclose the hidden costs.

Feel free to ask....

CHETAN

PT, as you said, 125 does not fit in any slab. If your gross salary is more than 10,000, then your PT should be 200 per month. Additionally, I have recalculated your CTC. It comes to 1.9. This calculation is similar to how I calculate for other employees. Please take a look at it.

Basic: 8000
HRA: 2560
Other Allowances: 2600
Gross Salary: 13160
PF Contribution (Employers @ 13.61% on Gross Salary): 1089.00
Bonus @ 10%: 8000.00
Leave with wages @ 5.75%: 757.00

CTC per month comes to 15806.00.
15806 multiplied by 12 months gives you 189672.00.
Approximately, it amounts to 1.9 Lacs per annum.

If you have any further queries, you can email me at sagar.p.rajput@gmail.com.

The above calculation aligns with how I calculate CTC for employees in my establishment. I hope this resolves your concern regarding CTC.

Regards,
Sagar Rajput

Thank you all for the detailed description of my CTC. My confusion has somewhat cleared up now. However, I will ensure to clarify everything with my HR and accounts department regarding how they calculate PF and PT. I am planning to switch to a new job, so I hope that any errors in my salary slip will not cause any issues with the company I am applying to.

Well, Mr. Sagar, I wanted to ask you how the calculations of PT are done. Can you please explain if I am not bothering you?
Thank you very much for all the information.
Rudhira

Hi Rudhira,

As you have tax brackets, similarly professional tax is deducted based on gross income slab-wise. Not all locations have professional tax; for example, salaried individuals in Mumbai or Tamil Nadu will pay professional tax, while those working in Delhi do not have this liability.

Hope this clears your doubts. If I am incorrect, please rectify.

Sashmita

Thank you so much, Sashmita. But if I could know in more detail about PT, then it would be great. Anyways, thanks for this information :D Have a nice day.

Hi Sagar and others,

Can you explain to me this "Leave with wages @ 5.75%: 757.00"? Are you talking about paid leaves? If not, then how did you arrive at this figure?

Secondly, can someone elaborate more on PT? Is it Professional Tax, and how is it calculated?

Anu

Hi Anu,

I am asking the same question about PT, but I think now no one is responding to my post... :( Please reply.