It is improper to show Gratuity amount as a part of CTC with the following reasons:
1. There is no monthly outgo payment towards Gratuity against any employee.
2. Gratuity is payable after 5 years continuous service on last drawn salary than how come employer project CTC amount on running salary?
3. If an employer shows Gratuity contribution as part of salary (CTC) then it should be paid to the employee on separation before completion of 5 years service as the so called contribution shown as CTC against gratuity is not payable by employer to the gratuity fund.
4. Companies are availing tax benefit on accrued gratuity amount.
5. As regards to PF, ESI contributions, it is monthly outgo from eligible employees from day one and the monies goes to Govt. Treasury every month. Whereas the gratuity amount they need not pay to the Trust and or LIC every month. Thus showing gratuity amount as CTC in employees offer and or Appraisal in not justified.
Regards,
Suresh
1. There is no monthly outgo payment towards Gratuity against any employee.
2. Gratuity is payable after 5 years continuous service on last drawn salary than how come employer project CTC amount on running salary?
3. If an employer shows Gratuity contribution as part of salary (CTC) then it should be paid to the employee on separation before completion of 5 years service as the so called contribution shown as CTC against gratuity is not payable by employer to the gratuity fund.
4. Companies are availing tax benefit on accrued gratuity amount.
5. As regards to PF, ESI contributions, it is monthly outgo from eligible employees from day one and the monies goes to Govt. Treasury every month. Whereas the gratuity amount they need not pay to the Trust and or LIC every month. Thus showing gratuity amount as CTC in employees offer and or Appraisal in not justified.
Regards,
Suresh