Is Our Salary Structure Legal? Seeking Advice on BASIC & DA Percentages in CTC

Could anyone suggest what should be the percentage of BASIC & DA in CTC? How should the salary statement be framed according to the law? Kindly send me a salary statement format. Currently, we have:

- BASIC & DA: 30% of CTC
- HRA: 40% of BASIC & DA
- CA: 800
- MA: 1250

Are we following the correct guidelines?

Thanks in advance.

Regards,
Shakunthala

We would suggest that while fixing the percentage for Basic + DA, please consider that it should satisfy the current minimum wages. There are no legal provisions for fixing the "%" for salary components. The purpose of fixing a percentage is to show uniformity in salary fixation, regardless of levels or designations.

We have attached the salary working sheet for your reference. We hope this will help you understand well.

Regards

Hi, Ms. Shakunthala. As per statutory regulations, there is no fixed percentage for salary breakups. The purpose of following these breakups is to optimize TDS deductions. However, in accordance with statutory requirements, the basic and DA components should not be less than the Karnataka Minimum Wages Act.

Hi, thanks for your reply. If you don't mind, I have a small doubt regarding the Excel sheet you have attached. You have provided two statements, one with ESI and another without ESI. With ESI, Basic & DA is 40% of CTC. Without ESI, Basic & DA is 50% of CTC. Why are these two separate statements?