Hi All, May I know the exact meaning for CTC? I am a bit confused between CTC and Gross CTC.. Kindly help the same..
From India, Chennai
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1From India, Chennai
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Understanding CTC (Cost to Company)
CTC means Cost to Company. It includes:
• Fixed salary, i.e., Basic, DA, HRA, PF, PT.
• Variable salary, i.e., Incentive, Bonus, all allowances, Performance pay.
• Benefits, i.e., holiday package, telephone, medical, leased accommodation.
These components together form the CTC.
From India, Calcutta
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CTC means Cost to Company. It includes:
• Fixed salary, i.e., Basic, DA, HRA, PF, PT.
• Variable salary, i.e., Incentive, Bonus, all allowances, Performance pay.
• Benefits, i.e., holiday package, telephone, medical, leased accommodation.
These components together form the CTC.
From India, Calcutta
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As rightly said by Mr. Kumar Sambhab Amar Ayoti Nayak, CTC is the total cost a company spends directly in terms of the wages to the employee.
Detailed Breakdown of Salary Components
Take Home = Basic Pay + HRA + DA + Transport Allowance (if applicable) + Shift/Attendance Allowance (as applicable) and any other fixed earning.
Gross = Take Home + PF deductions + PT deductions + ESI/GMI deductions + Variable Pay (if any) + any other deductions as applicable as per the company policies.
CTC = Take Home + Gross.
The above is as per the regular standard salary annexures. However, the pattern may change as per the company policy.
From India, Hyderabad
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Detailed Breakdown of Salary Components
Take Home = Basic Pay + HRA + DA + Transport Allowance (if applicable) + Shift/Attendance Allowance (as applicable) and any other fixed earning.
Gross = Take Home + PF deductions + PT deductions + ESI/GMI deductions + Variable Pay (if any) + any other deductions as applicable as per the company policies.
CTC = Take Home + Gross.
The above is as per the regular standard salary annexures. However, the pattern may change as per the company policy.
From India, Hyderabad
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I agree with both of you that CTC is the cost to the company. May I ask you one question, Sir? If CTC is the cost to the company, then how is PT a part of CTC? According to my knowledge, which I gathered from people like you, PT is a deduction from salary.
Can anyone enlighten me on this and clear my doubt? I am sure many HR professionals are confused about it.
From India, Mumbai
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Can anyone enlighten me on this and clear my doubt? I am sure many HR professionals are confused about it.
From India, Mumbai
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Hi Keshav, as far as I understand CTC, unless I am very much mistaken, apart from PT, ESI & PF are also deductions (though these are paid back to the employee) and yet part of CTC. Any expense spent, apart from operational expenses like seat cost, electricity payments, space rent, etc., is part of the CTC.
From India, Hyderabad
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From India, Hyderabad
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According to my point of view, there is no gross CTC. There is CTC and gross salary or gross pay.
GROSS SALARY:
Gross salary includes components such as basic pay, DA, special allowances, HRA, employer's contribution to PF, ESI, Gratuity, and other monthly emoluments.
CTC:
On the other hand, CTC comprises Gross Salary plus Bonus, Medical, LTA, and other annual emoluments paid yearly.
In simpler terms:
Gross Salary = basic + DA + special allowances + HRA + CCA + other monthly emoluments
CTC = Gross Salary + Bonus + Medical + LTA + other annual emoluments paid annually.
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GROSS SALARY:
Gross salary includes components such as basic pay, DA, special allowances, HRA, employer's contribution to PF, ESI, Gratuity, and other monthly emoluments.
CTC:
On the other hand, CTC comprises Gross Salary plus Bonus, Medical, LTA, and other annual emoluments paid yearly.
In simpler terms:
Gross Salary = basic + DA + special allowances + HRA + CCA + other monthly emoluments
CTC = Gross Salary + Bonus + Medical + LTA + other annual emoluments paid annually.
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CTC includes all compensation and benefits given by the company to employees, which encompass company accommodation, car, employer's contributions to PF/ESI, gratuity, bonus, LTA, incentives, etc. It also typically includes leave encashment, although many companies do not factor this into the CTC offered to recruits.
An example of a CTC breakdown for a Rs 6 lakh per annum CTC is provided below:
Salary:
- Monthly Annual
- Basic 17553 210633.6
- HRA 7021 84253
- Other Allowances 2908 34897
- Food Allowance 3000 36000
- Attendance Bonus 400 4800
- Uniform Allowance 4000 48000
- Professional Allowance 4000 48000
- Conveyance 4000 48000
- Education Allowance 1000 12000
Other Benefits:
- Annual
- Employer PF 780 9360
- Employer Mediclaim 1032 12380
- Bonus 1462 17546
- LTA 2000 24000
- Gratuity 844 10127
- Total 6118 73412
Gross:
- Monthly Annual
- 43882 526584
Deductions:
- CTC 39882 50000 599996
- PT 200
- PF 780
- Total Deductions 980
- Net Pay 42902
Regards,
Binu
From India, Bangalore
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An example of a CTC breakdown for a Rs 6 lakh per annum CTC is provided below:
Salary:
- Monthly Annual
- Basic 17553 210633.6
- HRA 7021 84253
- Other Allowances 2908 34897
- Food Allowance 3000 36000
- Attendance Bonus 400 4800
- Uniform Allowance 4000 48000
- Professional Allowance 4000 48000
- Conveyance 4000 48000
- Education Allowance 1000 12000
Other Benefits:
- Annual
- Employer PF 780 9360
- Employer Mediclaim 1032 12380
- Bonus 1462 17546
- LTA 2000 24000
- Gratuity 844 10127
- Total 6118 73412
Gross:
- Monthly Annual
- 43882 526584
Deductions:
- CTC 39882 50000 599996
- PT 200
- PF 780
- Total Deductions 980
- Net Pay 42902
Regards,
Binu
From India, Bangalore
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Understanding CTC
CTC is the total amount invested by a company for an employee. This includes cash compensation (like salary, incentives, etc.) and compensation in kind (like rent-free accommodation, car + driver, etc.). CTC also includes the company's share in the EPF/ESI, etc.
Regards,
Rajusiachen
From India, Coimbatore
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CTC is the total amount invested by a company for an employee. This includes cash compensation (like salary, incentives, etc.) and compensation in kind (like rent-free accommodation, car + driver, etc.). CTC also includes the company's share in the EPF/ESI, etc.
Regards,
Rajusiachen
From India, Coimbatore
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As rightly pointed out by some members, it's the total expenditure incurred on an employee (may be remuneration/wage) on a per-year basis. The standard deductions and matching contributions like PF (as per Government norms from the company side) also need to be included in the cost-to-company policy. This needs to be clarified to the employees who are joining your company well in advance; otherwise, take-home pay differences are visible on the first salary.
With warm regards,
Kesav Koundinya
Store Manager - TRENT
From India, Hyderabad
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With warm regards,
Kesav Koundinya
Store Manager - TRENT
From India, Hyderabad
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