What is CTC and take home salary?

What is CTC and take home salary?

To put it in simpler terms, CTC is a company’s spending on hiring and sustaining the services of an employee. CTC is considered a variable pay as it varies based on various factors and thus when the CTC varies, the take-home salary or net salary of the employee varies.

What percentage of CTC is take home?

Take Home Salary is the total salary which an employee gets after all necessary tax and other deductions are made. How much is Basic Salary of CTC? Basic salary is a fixed base part of an individual’s compensation package. Basic Salary is taxable & usually comprises of 35-50\% of the total gross salary.

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Why is take home salary different from CTC?

The difference between CTC and in-hand salary are the various deductions that occur at the time of payout. The take-home salary can be increased by proper tax planning and avoiding any income tax deductions. This will result in reducing the total deductions from the gross salary, thereby increasing the in-hand salary.

How do you calculate CTC?

CTC = Earnings + Deductions Here, Earnings = Basic Salary + Dearness Allowance + House Rent Allowance + Conveyance Allowance + Medical Allowance + Special Allowance.

What is current CTC for fresher?

CTC or Cost to Company is the total salary package and benefits of an employee per year. It is basically the amount that a company or employer is willing to spend both directly and indirectly on you as it’s employee. CTC is inclusive of monthly components such as basic pay, various allowances, reimbursements, etc.

What is the take home salary of a CTC employee?

For eg., CTC will include 12\% of employee contribution plus 12\% of employer contribution totaling 24\% towards PF. Performance Bonus payable annually. There will be deductions towards professional tax, income tax. So the take home monthly salary could be anywhere between Rs.1,15,000/- to Rs.1,25000/- approximately.

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What is CTC (cost to company)?

CTC or Cost to Company refers to the total salary package of an employee. CTC is inclusive of all monthly components like Basic Salary, Allowances, Perquisites or any other contributions. CTC is never the take-home salary of an employee. Basic Salary is the amount that an employee receives prior to any extras being added or payments deducted.

What is your monthly take-home salary?

Your monthly take-home salary is the amount that remains after subtracting the total deductions from gross pay. Let us understand the calculations using examples. Suppose your yearly CTC is ₹10 lakhs, and the company pays you ₹50,000 per year as a bonus.

What is the difference between basic pay and CTC?

While the basic pay is the income of the employee before any additions and deductions are made. In general, if considered, CTC is the combination of some additions and some reductions. Here is an example of an employee’s income with bifurcation showing earnings and deductions before getting into deep.

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