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Hi, Following are the components: Basic HRA Medical Telephone Petrol LTA Children Education Allowance Conveyance Allowance PDA Special Allowance Provident Fund Employer Contribution Thanks
From India, Mumbai
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From India, Mumbai
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Hi,
Please find below some of the common components of CTC:
- Basic
- DA
- HRA
- Medical
- Conveyance
- Wash Allowance
- Uniform Allowance
- Special Allowance
- Telephone Allowance
- LTA
- PF
- ESI
- Medical Insurance
- Gratuity
- Education Allowance
- Variable Pay / Performance-Linked Pay
- Bonus / Statutory Bonus
- Car Hire
- Petrol and Maintenance
- Driver Salary
- CLA
- Superannuation
- etc.
Regards,
Kartheka R
From India, Madras
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Please find below some of the common components of CTC:
- Basic
- DA
- HRA
- Medical
- Conveyance
- Wash Allowance
- Uniform Allowance
- Special Allowance
- Telephone Allowance
- LTA
- PF
- ESI
- Medical Insurance
- Gratuity
- Education Allowance
- Variable Pay / Performance-Linked Pay
- Bonus / Statutory Bonus
- Car Hire
- Petrol and Maintenance
- Driver Salary
- CLA
- Superannuation
- etc.
Regards,
Kartheka R
From India, Madras
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Venki,
CTC scope is wide and vast, encompassing anything and everything the company spends on the employee, whether direct or indirect, cash or kind. Each company has its own policies. The company will divide the salary into several heads, some taxable, some not. It is up to the company to distribute the salary through these different heads.
By the way, CTC stands for Cost to Company, in case anyone is unaware, which I doubt.
Nagaraj
From India, Bangalore
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CTC scope is wide and vast, encompassing anything and everything the company spends on the employee, whether direct or indirect, cash or kind. Each company has its own policies. The company will divide the salary into several heads, some taxable, some not. It is up to the company to distribute the salary through these different heads.
By the way, CTC stands for Cost to Company, in case anyone is unaware, which I doubt.
Nagaraj
From India, Bangalore
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Dear Venki,
The term CTC itself means the cost incurred by the company on the employee. Inclusion in CTC differs from company to company. In our case, CTC includes the following components:
- DA
- BASIC
- PERSONAL PAY
- SPECIAL PERSONAL PAY
- LTA
- MEDICAL
- SHIFT ALLOWANCE
- HRA
- MEDICLAIM PREMIUM
- CANTEEN SUBSIDY
- PETROL ALLOWANCE
- DRIVER'S SALARY
- LEASE PREMIUM PAID BY THE COMPANY ON YOUR COMPANY-LEASED CAR
- PERFORMANCE PAY
- SUPERANNUATION
Please let me know if you need more information.
Best regards,
HR_venki
From India, Mumbai
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The term CTC itself means the cost incurred by the company on the employee. Inclusion in CTC differs from company to company. In our case, CTC includes the following components:
- DA
- BASIC
- PERSONAL PAY
- SPECIAL PERSONAL PAY
- LTA
- MEDICAL
- SHIFT ALLOWANCE
- HRA
- MEDICLAIM PREMIUM
- CANTEEN SUBSIDY
- PETROL ALLOWANCE
- DRIVER'S SALARY
- LEASE PREMIUM PAID BY THE COMPANY ON YOUR COMPANY-LEASED CAR
- PERFORMANCE PAY
- SUPERANNUATION
Please let me know if you need more information.
Best regards,
HR_venki
From India, Mumbai
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Hi,
CTC is the term used to denote the overall package an employer is going to offer you. This includes everything from salary to benefits and perks.
Usual components include basic salary, medical benefits, vehicle and/or maintenance, telephone expenses, company's contribution to Provident Fund, Gratuity and Superannuation, group insurance schemes, leave travel benefits, incentives and bonuses, gifts during festivals, other annual/periodic payments if any, etc.
Salary as a percentage of CTC is difficult to generalize. It depends on the components that make up the CTC as provided by a company. Even a lower CTC might mean a higher take-home pay than an offer with a higher CTC if the other components are arranged differently. Similarly, you cannot blindly infer that with an increase in salary and position your pay as a percentage of salary will increase/decrease. You have to assess each offer separately.
Indian companies usually talk in terms of CTC as the figures look more impressive. But often they may mislead a candidate. You need to carefully look at their offer and calculate yourself how much your take-home pay will be. After all, all deductions are based on fixed percentages and you can easily arrive at a close figure. Even the company will guide you on this. Sometimes, even a lower take-home pay may be beneficial if the other payments are made against vouchers/bills (e.g., telephones, cars, refreshment, etc.). This will ultimately lower your tax liability. Hence you should look at both CTC as well as take-home pay while negotiating. Don't use only one of the two to negotiate.
You also have to look at certain other criteria like work timings, number of holidays, employee-centric schemes for further education, etc. You can't put a money value on these things, but obviously, you shouldn't ignore them as well.
From India, Dhanbad
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CTC is the term used to denote the overall package an employer is going to offer you. This includes everything from salary to benefits and perks.
Usual components include basic salary, medical benefits, vehicle and/or maintenance, telephone expenses, company's contribution to Provident Fund, Gratuity and Superannuation, group insurance schemes, leave travel benefits, incentives and bonuses, gifts during festivals, other annual/periodic payments if any, etc.
Salary as a percentage of CTC is difficult to generalize. It depends on the components that make up the CTC as provided by a company. Even a lower CTC might mean a higher take-home pay than an offer with a higher CTC if the other components are arranged differently. Similarly, you cannot blindly infer that with an increase in salary and position your pay as a percentage of salary will increase/decrease. You have to assess each offer separately.
Indian companies usually talk in terms of CTC as the figures look more impressive. But often they may mislead a candidate. You need to carefully look at their offer and calculate yourself how much your take-home pay will be. After all, all deductions are based on fixed percentages and you can easily arrive at a close figure. Even the company will guide you on this. Sometimes, even a lower take-home pay may be beneficial if the other payments are made against vouchers/bills (e.g., telephones, cars, refreshment, etc.). This will ultimately lower your tax liability. Hence you should look at both CTC as well as take-home pay while negotiating. Don't use only one of the two to negotiate.
You also have to look at certain other criteria like work timings, number of holidays, employee-centric schemes for further education, etc. You can't put a money value on these things, but obviously, you shouldn't ignore them as well.
From India, Dhanbad
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Hi,
Good one. Now, can anyone please advise if increments should be based on CTC or on gross monthly/yearly salary? I mean, CTC includes various components and can differ from company to company. What are your thoughts on a scenario where a company provides increments based on CTC rather than gross earnings?
From India, Mumbai
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Good one. Now, can anyone please advise if increments should be based on CTC or on gross monthly/yearly salary? I mean, CTC includes various components and can differ from company to company. What are your thoughts on a scenario where a company provides increments based on CTC rather than gross earnings?
From India, Mumbai
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In simple terms, CTC means Cost to Company, which refers to the expenses that a company bears for a particular employee. The total cost, in cash or kind, is encompassed in the CTC. However, the money that an employee receives as a fixed monthly amount is referred to as the basic salary.
From India, Delhi
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From India, Delhi
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Cost to Company (CTC)
Cost to Company (CTC) is a term used by many organizations in India to describe the total amount an organization would spend on an employee in a year. CTC is a comprehensive package that includes various components, both direct and indirect, monetary and non-monetary. Here are the primary components of CTC:
1. Direct Benefits
These are the regular payments made to an employee and are usually part of the monthly salary.
Basic Salary: The core of the salary structure, forming the base for other components like allowances and deductions.
House Rent Allowance (HRA): A portion of the salary provided for housing expenses, often calculated as a percentage of the basic salary.
Dearness Allowance (DA): A cost of living adjustment allowance paid to employees, often calculated as a percentage of the basic salary.
Special Allowance: Any additional allowance that may be part of the salary structure, not falling into specific categories.
Conveyance Allowance: An allowance provided for commuting expenses.
Medical Allowance: A fixed allowance provided for medical expenses.
Leave Travel Allowance (LTA): Reimbursement for travel expenses incurred during leave.
2. Indirect Benefits
These are benefits that employees receive, which are not directly paid out as part of the monthly salary but add to the overall compensation.
Employer's Contribution to Provident Fund (PF): A portion of the salary contributed to the employee's provident fund account.
Gratuity: A lump-sum payment made to employees who have completed a certain number of years with the company, usually calculated as a percentage of basic salary.
Medical Insurance: Health insurance coverage provided by the employer.
Accidental Insurance: Coverage for accidents provided by the employer.
Retirement Benefits: Other benefits related to retirement savings plans or pension schemes.
3. Performance and Incentive Pay
These are additional payments made based on performance or achievements.
Performance Bonus: Extra payment based on individual or company performance.
Incentives: Additional pay for achieving specific targets or goals.
Annual Bonus: A lump sum paid at the end of the year, often linked to performance.
4. Reimbursements
These are payments made to employees for expenses incurred during their work.
Telephone/Mobile Bill Reimbursement: Reimbursement for expenses on official communication.
Travel Reimbursement: Reimbursement for business travel expenses.
Meal Coupons/Vouchers: Coupons or vouchers provided for meals.
5. Non-Monetary Benefits
These are perks or benefits that add value to the employee's overall compensation but do not come as direct cash payments.
Company Car: A car provided by the company for personal and professional use.
Accommodation: Housing provided by the employer.
Stock Options: Shares of the company offered to employees as part of compensation.
Educational Allowances: Payments or reimbursements for education-related expenses.
Fitness/Gym Membership: Memberships to fitness clubs or gyms.
Conclusion
CTC is a holistic view of the total expenditure an employer incurs for an employee. It includes various components, from direct salary payments to various benefits and allowances. Understanding the different components of CTC helps employees better assess their compensation packages and make informed decisions about their employment.
From India, Mumbai
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Cost to Company (CTC) is a term used by many organizations in India to describe the total amount an organization would spend on an employee in a year. CTC is a comprehensive package that includes various components, both direct and indirect, monetary and non-monetary. Here are the primary components of CTC:
1. Direct Benefits
These are the regular payments made to an employee and are usually part of the monthly salary.
Basic Salary: The core of the salary structure, forming the base for other components like allowances and deductions.
House Rent Allowance (HRA): A portion of the salary provided for housing expenses, often calculated as a percentage of the basic salary.
Dearness Allowance (DA): A cost of living adjustment allowance paid to employees, often calculated as a percentage of the basic salary.
Special Allowance: Any additional allowance that may be part of the salary structure, not falling into specific categories.
Conveyance Allowance: An allowance provided for commuting expenses.
Medical Allowance: A fixed allowance provided for medical expenses.
Leave Travel Allowance (LTA): Reimbursement for travel expenses incurred during leave.
2. Indirect Benefits
These are benefits that employees receive, which are not directly paid out as part of the monthly salary but add to the overall compensation.
Employer's Contribution to Provident Fund (PF): A portion of the salary contributed to the employee's provident fund account.
Gratuity: A lump-sum payment made to employees who have completed a certain number of years with the company, usually calculated as a percentage of basic salary.
Medical Insurance: Health insurance coverage provided by the employer.
Accidental Insurance: Coverage for accidents provided by the employer.
Retirement Benefits: Other benefits related to retirement savings plans or pension schemes.
3. Performance and Incentive Pay
These are additional payments made based on performance or achievements.
Performance Bonus: Extra payment based on individual or company performance.
Incentives: Additional pay for achieving specific targets or goals.
Annual Bonus: A lump sum paid at the end of the year, often linked to performance.
4. Reimbursements
These are payments made to employees for expenses incurred during their work.
Telephone/Mobile Bill Reimbursement: Reimbursement for expenses on official communication.
Travel Reimbursement: Reimbursement for business travel expenses.
Meal Coupons/Vouchers: Coupons or vouchers provided for meals.
5. Non-Monetary Benefits
These are perks or benefits that add value to the employee's overall compensation but do not come as direct cash payments.
Company Car: A car provided by the company for personal and professional use.
Accommodation: Housing provided by the employer.
Stock Options: Shares of the company offered to employees as part of compensation.
Educational Allowances: Payments or reimbursements for education-related expenses.
Fitness/Gym Membership: Memberships to fitness clubs or gyms.
Conclusion
CTC is a holistic view of the total expenditure an employer incurs for an employee. It includes various components, from direct salary payments to various benefits and allowances. Understanding the different components of CTC helps employees better assess their compensation packages and make informed decisions about their employment.
From India, Mumbai
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As the acronym CTC indicates, Cost To Company, any form of payment, either in cash or kind, paid to the employee, including statutory contributions remitted on behalf of the employer to the employee's account, is considered as Cost To Company.
In kind, this could include uniforms, canteen subsidy, shoes, raincoats, towels, soaps, and any other similar items issued to employees on a monthly basis, which are also included in the CTC component.
The further extension of CTC could involve payments towards leave encashment, and payment for National and Festival Holidays (I am including this because some companies announce holidays beyond the statutory requirement).
Statutory payments could include PF, ESI, Bonus, and provisions for Gratuity.
Fringe benefits could encompass housing accommodation, car, leave travel allowance, medical reimbursement, premium paid towards Mediclaim policies, personal accident policy, etc.
Regards,
MVK
From India, Madras
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In kind, this could include uniforms, canteen subsidy, shoes, raincoats, towels, soaps, and any other similar items issued to employees on a monthly basis, which are also included in the CTC component.
The further extension of CTC could involve payments towards leave encashment, and payment for National and Festival Holidays (I am including this because some companies announce holidays beyond the statutory requirement).
Statutory payments could include PF, ESI, Bonus, and provisions for Gratuity.
Fringe benefits could encompass housing accommodation, car, leave travel allowance, medical reimbursement, premium paid towards Mediclaim policies, personal accident policy, etc.
Regards,
MVK
From India, Madras
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Salary structure CTC 15000.xlsx
Creating a Competitive Salary Structure.doc