Budget updates move fast, keep up with CAclubindia Pro. Subscribe today!

Basic Salary

1627 views 1 replies

Anususha

Client Engagement Associate

61 Points Joined May 2010

Dear All,

This is from an IT Organisation. We are palnning to change the CTC structure of all employees. What they are suggesting is, to bring down the Basic salary to 10% from 30%. Now I want to know

1. What will be impact on company?

2. Is there any law for minimum % age & minimum amount for Basic salary? ( for calculation of PF)

3. What should be the minimum percentage of basic salary.

Please guide me on this on Urgent basis as I they are concluding their decision very soon.

PLS HELP

Thanks & Rgds,

Anu

Replies (1)

Pankaj Arora

Learner

3134 Points Joined September 2009

Well basis limit is not fix from the gross salary. but you should see saving of employees if you keep little high basic salary than they will get higher deduct of PF amount and equal contribution from employer. But it can increase employer contribution which is you booking as an expense.