Why Do Salary Structures Have Categories Like Medical and House Rent?

I am designing a salary structure for a cosmetic company. Please describe why a salary structure is divided into different categories, such as Medical, House Rent, CLA, Conveyance, etc. Is it important to do so?

The place where I previously worked provided medical facilities as well, but still, some amount is mentioned as "Medical" on the salary slip.

Rafay: Salaries are structured to ensure employees can plan their expenditure (nominal) and save on tax (strong reason). If you work with a good C.A or an HR/Tax consultant, then you'll get the right components and their limits (per provisions in the IT Act). Hope this helps.