Salary break up

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 January 2014 Is there any basic rule in the Law to decide the break off of the salary .

Suppose a person is getting a 15000 p.m so what should be its basic,D.A, H.R.A, conveyance,& other break up...

@VaibhavJ

@VaibhavJ (Expert)
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11 January 2014 Hi

There is no basic law but general practice is:

Basic salary should be 30 to 40% of gross salary, DA as per minimum wages, HRA minimum 5% max 40/50% of Basic Salary, conveyance allowances Rs. 800. Child edu. allow. Rs. 200, rest to be trf to Other Allowance / CCA.

Thanks

Nikhil Kaushik online

Nikhil Kaushik online

(Expert)
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11 January 2014 add medical reimbursement of Rs 15000 pa or 1250 pm to the above..

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@VaibhavJ

@VaibhavJ (Expert)
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11 January 2014 Yes correct, you can add but in my view as long as salary is not taxable reimbursement should not be added to CTC.

Thanks

Vishal

Vishal (Expert)
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12 January 2014 Further to explanation given by vaibhavj, mobile and food coupons can also be given, but could be shown under ctc as this might be not taxable for the employee but is a cost for the company.

@VaibhavJ

@VaibhavJ (Expert)
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12 January 2014 Yes Vishal, but as long as salary is out of taxable bracket reimbursement should be avoided, since it adds on admin cost of company too.

Thanks