Salary structure

and .. certain allowances are mandatory as per labour law, so you need to pay it..

Thanks

in my opnion their is no need to bifurcate the salary as per law.

According to me, yes it is cumpulsory to bifurcate salary as per IT lAW, And there is no ratio of bifurcation its is prescribed by the employer to its employee....

Originally posted by : MANJIT SINGH SAHDEV
	in my opnion their is no need to bifurcate the salary as per law.

Dear Manjit,

Can you justify why there is no need?

Thanks!

Originally posted by : manoj kachkure
	what will be the ratio for this bifurcation?

Hi 

Basic salart should be 40% of your Gross Salary;

HRA min 5% of Basic , Max 50% of Basic Salary;

Conveyance Allowance Rs. 800 max;

Child Edu. Allowance Rs. 200 max;

Medical Reimbursement Rs. 1250 (only if salary is taxable)

Statutory Bonus Rs. 292 p.m. / Max Rs. 700 p.m. (If basic salary is 10k or less p.m.)

LTA 3% of Gross Salary (only if salary is taxable)

Fule Reimbursementts Rs. 2000 - Rs. 6000

Rest salary can be allocated to Perofrmence Bonus, Other Allowance, CCA etc.

Thanks!

Dear All

IT act doesnot say as to how we should pay salary. It states the rule how a particular components is taxed or exempted from Tax.

If you pay full salary as basic without any bifurcation into Basic,HRA,Conv,Gen Allowance and Flexi basket( Medical, LTA, and other reimbursements), the effect will be like

• Full salary is taxed, means more tax on salary, less take home to employee.
• More cost to employer in terms of Bonus/Gratuity/ Leave encashment/ Provident Fund..

Hence in mutual interest( of employer and employee), the structure is desiged by the company so that maximum part of the salary is taxfree.

Regards

Puran Dangwal

Hi All...As per  IT Law there is exemption for HRA, so that if anybody wants to claim this exemption they need to Bifurcate their Salary Structure,you can also claim Sec.10 exemptions  like TA and medical Allowance.

Below are the General Salary Structure:

Gross Salary(PM)  Rs. 35000

Basic: 40% of Gross Salary

HRA 50% for Metro City and 40% for Non-Metro from Basic Salary

TA: 800 Pm

Medical: 1250 Pm

Rest of the amount goes to Special Allowance which is fully Taxable..

Thanks

N. Rajendran--Manager-Accounts