Compensation & Benefits - Breakup

Hi,
We are in the process of restructuring salaries to some of our senior executives. Can someone share the details of CTC breakup being practiced at your organisation?
Details required are the different heads and the percentage of total emoluments against which it is apportioned.
Thanks and Awaiting your response,
Khullam

Hi!
I suggest you undergo a comprehensive Executive Compensation Review and Design of a new Salary Structure.
Merely breaking up a structure based on how others implemented a system designed for them may not work best for your organization. Compen consultants like us look at the whole picture and would design one that takes into consideration the impact of such executive compensation system to the rank and file salary and benefits structure.
It's quite rare to see two distinct salary structures and benefits within an organization. The usual practice is to show the "pay line" pattern from R&F to the executive level, so the board and the shareholders can easily see the real picture of how their organization's compen and benefits are being implemented and managed.
Get in touch if you need real help.
Best wishes.
Ed Llarena, Jr.
Managing Partner
Emilla Consulting

CTC can be breaked into
Basic Salalry,
uniform maintenance allowance,
conveyance reimbursement,
servant,
professional development,
Education
Driver
Company owned car
Super Annuation
PF
Gratuity
HRA
Soft furnishing

Hi Khullam,

It's my pleasure to answer some of queries:-

Q. We are in the process of restructuring salaries to some of our senior executives. Can someone share the details of CTC breakup being practiced at your organisation?

A. Restructuring salaries is a major excercise esp of Senior Management as they come under Higher Tax Bracket. First determine as what is the basic philosophy or premise for this excercise and the desired outcome.If it is tax savings then there would be different approach or if it is matching the Industry standards then it is a different excercise.

For instance if the premise is tax savings, then include Professional Development Allowance & Car lease etc .

Q. Details required are the different heads and the percentage of total emoluments against which it is apportioned.

A.

Monthly -

Basic salary - depends on the structure of your organization.

HRA - It is 50 % of Basic salary in 4 metro cities and 40% in other towns.

Conveyance allowance- Rs 9600/ p.a.

Annuals-

Medical Reimbursement - Rs 15,000/- p.a.

LTA - varies from company to company, usually same as basic or two times the basic amount.

PDA - Use it to balance the total.

Petrol Reimbursement - A fair amount based on the person's consumption.

Car lease - A fair amount applicable in your city with due consideration Arm length Transaction.

Hope this helps you to some extent.

Regards,

Rajat Joshi

Thanks Rajat for yourinputs.
Basically it is a tax saving initiative. We are just looking for the apportionment of the CTC into different heads.
Nowadays, i understand there are quite a few 'basket of allowances', etc from which an employee can choose from - just need to understand things followed by someone else.
rgds
khullam

Hi Khullam,
Welcome!..
Suggest that you take the help of local Chartered Accountant in structuring the break-ups esp those pertaining to tax savings schemes as they usually come under scanner of IT fellows.
Cheerio
Rajat

Hi!
Can anyone please suggest a good workshop/course for understanding the Compensation and its structured break up
Cheers !!!

Hi,
PDA is professional development allowance, wherein you can claim reimbursements by showing supposrtings / voucher for journals, professional books, training courses.
Best Regards'
Anu