Understanding Salary Breakdown: How Are EPF, ESI, and Other Components Calculated?

Dear all,

I want to know the breakdown of my salary and how it can be calculated. Could you please provide information on the percentages of EPF, ESI, CCA, FA, TA, DA, SA, etc.? Is there a specific format or resource I can refer to for more details? Your assistance is greatly appreciated. Thank you.

Hello Pooja,

The components of the salary breakup may be as below; you can prepare it to suit your needs. HRA would be 40 or 50% of the basic.

Basic

HRA 40 - 50% is exempted from taxes, depending on the class of the city.

CCA - 825/- is exempted from tax.

Other Allowances

Mobile Reimbursement

Medical Reimbursement of 1250/month is exempted from tax.

Gross Per Month = Sum of all the above.

Gross Per Annum = 12*Gross/Month.

PF Contribution = 12% of Basic/Annum.

ESI Contribution = 4.75% of Gross/Annum.

Medical = The mediclaim facility provided to employees who are not covered under ESI as the maximum ceiling for ESI is 10000/Month. Getting more than this will be covered under Mediclaim or it depends on company policy.

Ex-Gratia/Bonus = A fixed amount as a Bonus.

Annual Fixed Gross Cost = Gross/Annum + Ex-gratia.

Annual Total Cost = AFGC + PF + ESIC.

Annual total cost is also called CTC.

Apart from this, Food coupons, Holiday package, and Furnishing items are included in their CTC.

I hope this clears up some of your queries.

Regards,

Amit Seth.

Hi,

I have enclosed herewith a sample salary calculation template. Please open it before going through this mail.

1. Basic + DA:
Basic can be given 30-40% of the gross salary, while DA is fixed as it has been revised to Rs. 648/-.

2. HRA:
HRA can be given up to 50% of Basic if the employee lives in a Metropolitan area or up to 40% in other cities. That will be non-taxable in case of submission of the rent receipt.

3. Conveyance:
Rs. 800/- per month is non-taxable.

Education Allowance:
Rs. 200/- per month is non-taxable in case of two children.

Bonus:
8.33% to 20% can be given.

PF:
Employer Contribution: 12% of Basic + DA. Employee contribution remains the same.

ESIC:
Applicable if the employee per month earns variables of more than Rs. 10,000/-; earlier it was Rs. 6,500/- amended in the month of October.
Employer Contribution: 4.75% of all earned per month income.
Employee Contribution: 1.75% of all earned per month income.

Regards,
Deepak Dwivedi
Asst. Manager - HR