How Do I Calculate CTC for a Rs. 72,000 Take-Home Salary Without ESI or PF?

Hi, I need to prepare the CTC for an employee who has a take-home salary of Rs. 72,000. There is no ESI or PF, and the annual bonus amounts to around Rs. 21,000. Additionally, there are incentives paid in cash on a quarterly basis, but I am unsure whether to include them in the CTC calculation. Please guide me on how to prepare the CTC for the same. My boss has requested it to be above Rs. 10 lakh. Many thanks.

Pls look at the following calculation:

Particulars Per Month Annual

Basic 36000 432000

DA 7200 86400

HRA 21600 259200

Conveyance 800 9600

Medical 1250 15000

Phone Allowance 3000 36000

Food Allowance 1250 15000

Newspaper Allowance 90 1080

Other Allowances 810 9720

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Take Home 72000 864000

Prof Tax 2500 (deducted from salary)

Gratuity 24923 (this amount is grat/yr payable after 5 yrs)

Bonus (paid annually) 21000

LTA (paid once in 2 years) 100000

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CTC 10,12,423 (as per your requirement)

Please note since your city was mentioned as New Delhi, I have calculated this as per metro-related.

Also, note that if Professional Tax for your city is different, it would be different here, change figure accordingly. I have put up PT as per Mumbai rule.

LTA is reimbursed to the actual fare price based on the shortest rail route (class would depend on the designation).

Gratuity is paid to a candidate when s/he leaves the organization after 5 years, so every year, his/her due amount is set aside from his/her site. If s/he leaves the organization before 5 years, the amount goes to the Company’s kitty and can be used for its developmental purpose.

Food allowance is exempted from tax if it is calculated up to Rs. 50 per day, so I’ve calculated taking that into consideration so that there's no tax liability also.

Medical Allowance if given on a fixed basis attracts tax. However, if you are providing a reimbursement of medical bills/doctor's fees, it is exempted to the actual amount or Rs. 1250 per month, whichever is lower. So, I have calculated it as per the rule.

Other allowances are taxable and would have tax applicability, which need not be reflected in CTC calc.

Phone allowance too is taxable unless the company is reimbursing against the bills.

I hope it was of some help to you... :)

Hi Ankita, many thanks for the info. I tweaked it a bit, and it worked pretty well. Now, he has asked me to make it around 10 lakhs 30 thousand. I need some help on the same too. Let me know if there is an Excel sheet I can work upon.

Thanks again.
Regards.

Hi, I was trying to upload an Excel sheet, but it didn't work, so I had to put up the data in Word. I understood that it doesn't support .xlsx, so I converted the file and am attaching it.

You can have the added amount as Other Allowance, wherein you need not specify why you are giving a certain amount of money. It wouldn't cause much of a headache as it will be taxed anyway.

That was how we worked; we placed all the balance in Other Allowance.

Regards.

Sorry for the errors in the previous post. If you were to add the remaining amount to the Other Allowance, your in-hand pay would increase, which I assume you wouldn't want. Please check the Excel file I've corrected. I included rentals for office premises, opportunity cost, and electricity usage. It might sound strange, but it's true and was shared by someone who had such factors mentioned in the CTC.  I hope this information is helpful.

I have seen your attached Word file. You have mentioned Prof. Tax in the CTC part. As per my knowledge, CTC stands for Cost to Company, in which we can't mention Professional Tax or P.F. (deducted from the employee) amount. However, we can mention Bonus, Gratuity, and P.F. (contribution from the employer side). When we create a monthly salary breakdown, we include the deduction part from the employee's side (such as P.F., Professional Tax, ESIC, etc.).

Kindly let me know if I am mistaken.

Thank you.

With regards,
Mimu

CTC Sheet Attached for Reference

Dear All,

Please find the attached CTC Sheet for your reference.

With Regards,

Devendra N Tripathi Cite HR - Zion Steel Adhunik Metaliks Limited || Works: Rourkela || Dist: Sundargarh || Orissa Email: [Email Removed For Privacy Reasons] || Cell: [Phone Number Removed For Privacy Reasons]