Struggling with Salary Calculations in a Startup? Let's Break Down BASIC, HRA, and PT Deductions Together

Hi everyone,

I am working with a startup company as an HR trainee. It is a small-scale company. I need help with salary calculations (BASIC, HRA, PT). For example, if my gross salary is 1,80,000/-, how do I calculate BASIC, HRA, and PT deductions only?

Thank you.

To calculate the BASIC, HRA, and PT deductions from your gross salary of 1,80,000/-, follow these steps:

1. Calculate Basic Salary (BASIC):
- The Basic Salary is typically a fixed portion of the gross salary. It usually ranges from 40% to 50% of the gross salary.
- For a gross salary of 1,80,000/-, assuming a Basic Salary percentage of 50%, the Basic Salary would be:
- Basic Salary = Gross Salary * Basic Salary Percentage
- Basic Salary = 1,80,000 * 50% = 90,000/-

2. Calculate House Rent Allowance (HRA):
- HRA is usually a percentage of the Basic Salary. It can vary based on the city of residence.
- For example, if the HRA percentage is 40% of the Basic Salary:
- HRA = Basic Salary * HRA Percentage
- HRA = 90,000 * 40% = 36,000/-

3. Calculate Professional Tax (PT) Deduction:
- Professional Tax is a state-level tax that varies across states in India. The deduction is based on the gross salary and the state-specific PT slabs.
- For example, if the PT deduction for your salary range is 200/-:
- PT Deduction = 200/-

Therefore, based on the given gross salary of 1,80,000/-, the calculated deductions would be:
- Basic Salary: 90,000/-
- House Rent Allowance (HRA): 36,000/-
- Professional Tax (PT) Deduction: 200/-

These calculations provide a simplified breakdown of how to determine the BASIC, HRA, and PT deductions from your gross salary.