How To Design A Salary Structure For A Employee?
Design of the salary structure is entirely up to the company, there are no laws or rules laid down. Most companies base their structure so that the employee benefits with respect to Income tax. Thus you must know the Income tax rules and exemptions before you start defining the salary structure.
The starting point is the CTC (cost to company).
Basic is calculated based on a percentage of the CTC, if the company has a contributory Provident fund then it must be kept in mind that the company has to contribute the same amount of PF as the employee.
The best way is to try out a few combinations and protect the company as well as the employee.
Basic can be between 25 to 30 percent of CTC. HRA is normally between 15 to 25 percent of basic. Medical should not be more than 15000 per year.
Travel/conveyance allowance exempt by IT is 9600 per year so stay within this limit.
PF contribution is between 8.33 to 10 percent of basic, if you plan to include DA (dearness allowance) to salary then it should be around 20 percent of basic, then this DA is added to basic when calculating the PF contribution.
You can then add a component of one months basic as leave travel allowance. Then add about one to two months basic as Bonus. The balance of CTC can then be shown as other allowances.
I am enclosing one format of Salary structure, and you can also calculate TDS from the format.
Categories: HR Tags: How To Design A Salary Structure For A Employee?
Salary Structure
I Have Attached Salary Structure
| SALARY STRUCTURE | ||||||||
| Name | : | |||||||
| Designation | : | |||||||
| Department | : | |||||||
| Date of Birth | : | |||||||
| Date of Joining | : | |||||||
| BREAK UP OF THE SALARY | : | Break upto Gross Salary Per month | Break upto Gross Salary Per Annum | |||||
| Salary Sheet | Basic | : | Rs. 3,587.00 | Rs. 43,044.00 | Basic + D.A 50% | |||
| D.A. | Rs. 3,913.00 | Rs. 46,956.00 | HRA 20% | |||||
| HRA | : | Rs. 3,000.00 | Rs. 36,000.00 | Medical 10% | ||||
| Conveyance (Fixed) | : | Rs. 900.00 | Rs. 10,800.00 | Misc. 1% | ||||
| Education .Allowance (Fixed) | : | Rs. 1,950.00 | Rs. 23,400.00 | Conveyance 6% | ||||
| Medical (Fixed) | : | Rs. 1,500.00 | Rs. 18,000.00 | Education. 13% | ||||
| Misc. Allowance | : | Rs. 150.00 | Rs. 1,800.00 | |||||
| Monthly Gross | : | Rs. 15,000.00 | Rs. 180,000.00 | |||||
| Liabilites | P.F. | : | Rs. 780.00 | Rs. 9,360.00 | ||||
| E.S.I. | : | |||||||
| MLWF | : | |||||||
| Ex-Gratia | : | |||||||
| L.T.A | Rs. 2,000.00 | |||||||
| Bonus | Rs. 6,000.00 | |||||||
| Leave Encashment | ||||||||
| Gratuity | : | |||||||
| Superannuation | : | |||||||
| Total Liabilities | : | Rs. 780.00 | Rs. 17,360.00 | |||||
| Deduction | P.F. | : | Rs. 780.00 | Rs. 9,360.00 | ||||
| E.S.I.C | : | |||||||
| MLWF | : | |||||||
| Income Tax | ||||||||
| Professional Tax | : | Rs. 200.00 | Rs. 2,500.00 | |||||
| To tal Deductions | Rs. 980.00 | Rs. 11,860.00 | ||||||
| NET TAKE HOME | 14,020.00 | 168,140.00 | ||||||
| Facilities | Mobile Bill ( On Actual) | 500 | ||||||
| Car / Fuel Expenses(On Actual) | ||||||||
| Mobile Handset | ||||||||
| Laptop | ||||||||
| TOTAL FACILITIES COST | 500 | 0 | ||||||
| CTC | 16,280.00 | 197,360.00 | ||||||
| * | *Gratuity (Eligibility for Gratuity: 5 years of Service ) | |||||||
| * | *Superannuations (Eligibility for Superannuation: 10 years of Service ) | |||||||
Click Here to Download Salary Structure
Categories: HR Tags: Salary Structure
Salary Break Up in Excel Sheet
I have attached standard format for break ups in salary.
| NAME OF THE COMPANY | |||
| INCREMENT/ PROMOTION DETAILS AS ON _______ | |||
| Emp. Name : | Mr. | Emp. Code : | |
| Designation : | Sr. Executive | Department : | |
| Promoted / Redesignated as : | NA | Transfer (if applicable) | |
| From | To | ||
| NA | NA | ||
| SALARY – OUT OF ESI (Rs./Month) | |||
| Monthly Earnings | Deductions | ||
| Basic & DA | 7846 | PF | 780 |
| HRA | 3139 | PT | 150 |
| TA | 800 | ||
| CEA | 200 | ||
| Uniform Allowance | 500 | ||
| Sub Total | 12485 | (C) | 930 |
| Other Allowance | 5044 | ||
| Gross Earnings(A) | 17529 | Take Home(A-C) | 16599 |
| Other Benefits | TCC (A+B) | TCC (P.A.) | |
| PF | 780 | ||
| Bonus | 654 | ||
| 19,616 | 235,392 | ||
| Medical | 654 | ||
| (B) | 2087 | ||
| Gratuity as per Act: | 4608 | ||
| Gross Emoluments : | TCC | TCC + GRAT. | |
| 235392 | 240000 | ||
Cost To Company or CTC Salary Format in Excel
Attached herewith CTC format that may help u to identify net take home salary, monthly CTC, yearly CTC in Excel.
| company’s Logo | ANNEXURE-I | Notes:- | |||||||
| SALARY BREAK-UP | value | PF deposited in PF department | |||||||
| NAME | ANNUAL BENEFITS:- | ESIC deposited with ESIC dept | |||||||
| DESIGNATION | Individual Component (IC) | Prof tax paid to PT department | |||||||
| DEPARTMENT | Bonus | Lumpsum LTA payable in August in some company | |||||||
| DATE OF JOINING | Bonus paid at the time of Diwali | ||||||||
| Gratuity will be paid after 5 yrs services | |||||||||
| EARNINGS | DEDUCTIONS | Exgratia | |||||||
| SALARY HEAD | AMOUNT (Rs.) | SALARY HEAD | AMOUNT (Rs.) | canteen subsidy | |||||
| Basic | 12,000 | PF Employee | 1,440 | Company Component (CC) | |||||
| H R A | 4,800 | ESI Employee | – | Coverage towards Group Mediclaim Policy (GMP) | |||||
| Conv. All | 800 | Profession Tax(PT) | Coverage towards Health insurance scheme (HIS) | ||||||
| Leave Travel Allowance(LTA) | 840 | Income Tax | 2,946 | Coverage towards Group Saving Linked Insurance (GSLI) | |||||
| Child Education Allowance(CEA) | 600 | HIS | Coverage towards personal accident | ||||||
| Site Allowance | 4,750 | GSLI | 280 | Employee deposit Linked insurance (EDLI) | |||||
| Special Pay | 5,950 | Coverage towards Group Term Life (GTL) | |||||||
| Medical Allowance | 1,250 | Term Insurance | |||||||
| Personal Pay | 15,361 | ||||||||
| Additional Allowance | 7,500 | ||||||||
| SALARY (GROSS) / PM | 53,851 | ||||||||
| Pension Employer(8.33% of Minimum (basic or 6500)) | 541 | ||||||||
| PF Employer( PF employee-pension Employer) | 899 | ||||||||
| ESI Employer | – | ||||||||
| Gratuity | 500 | ||||||||
| Superannuation | |||||||||
| Company Component (CC) | 2,541 | ||||||||
| Medical (Reimb) | – | ||||||||
| Conv (Reimb) | – | ||||||||
| Telephone (Reimb) | – | ||||||||
| Others (Reimb) | – | ||||||||
| SALARY (CTC) / PM | 58,332 | TOTAL DEDUCTION | 4,666 | ||||||
| Cash in Hand (PM) | 49,185 | ||||||||
| SALARY (CTC) / PA | 699,984 | ||||||||
| Notes: | |||||||||
| 1. TDS / FBT Deduction – as applicable | |||||||||
| Prepared by | Checked by | Authorised by | |||||||
Salary Break Up Calculator
I have attached salary break Up calculator in excel format.
| Yearly & Monthly Break Up of Gross Salary | ||||||
| Basic 30% | ||||||
| HRA 20% | ||||||
| City Compensatory All. 30% | ||||||
| Conveyance Rs.800 per month | ||||||
| Special Allowance Balance | ||||||
| Yearly | Grand Totals | Monthly | ||||
| Gross Salary | 200,000 | 16,667 | ||||
| Basic | 60,000 | 5,000 | ||||
| HRA | 40,000 | 3,333 | ||||
| City Compensatory All | 60,000 | 5,000 | ||||
| Employers Contribution 12% of basic or Rs. 780/- whichever is less | 7,200 | 600 | ||||
| Conveyance | 9,600 | 800 | ||||
| Special Allowance | 23,200 | 200,000 | 1,933 | 16,667 | ||
| Less : Deduction | ||||||
| P.F. ( Employees Contribution 12% of Basic or Rs 780/- whicever is less | 7,200 | 600 | ||||
| P.F. ( Employers Contribution 12% of Basic or Rs 780/- whicever is less | 7,200 | 600 | ||||
| Professional Tax | 2,500 | 16,900 | 200 | 1,400 | ||
| Net Salary Payable | 183,100 | 15,267 | ||||
| Add Performance Bonus | 30000 | |||||
| 213,100 | ||||||
| Enter Values only in Yellow Cells | ||||||
Categories: HR Tags: Break, CALCULATOR, Salary, Up
Salary Structure
I have Attached Salary Structure
| SALARY STRUCTURE | |||
| BREAK UP OF THE SALARY | : | Break upto Gross of 71K – Above | |
| Salary Sheet | Basic | : | Rs. 7,632 |
| HRA @ 50% of basic | : | Rs. 3,816 | |
| Conveyance | : | Rs. 800 | |
| E.A | : | Rs. – | |
| Helper Allowance | : | Rs. 1,145 | |
| Others | : | Rs. 2,357 | |
| A | Gross | : | Rs. 15,750 |
| Reimbursements | Medical | : | Rs. 1,250 |
| LTA | : | Rs. – | |
| B | Reimbursements | : | Rs. 1,250 |
| C = A+B | Monthly Gross | : | Rs. 17,000 |
| Leave Salary | : | ||
| Liabilities | P.F. | : | Rs. 780 |
| E.S.I. | : | Rs. – | |
| Gratuity | : | Rs. 314 | |
| Bonus | : | Rs. 1,417 | |
| Car Fuel/Driver | : | ||
| Ex-Gratia | : | Rs. – | |
| D | Liabilities | : | Rs. 2,510 |
| Choice Pay | Sodexho Coupons | : | Rs. – |
| Driver Allowance | : | Rs. – | |
| Petrol Reimburse | : | Rs. – | |
| E | Choice Salary | : | Rs. – |
| F = C+D+ E | CTC | : | Rs. 19,510 |
| Deductions | P.F. | : | Rs. 780 |
| E.S.I. | : | Rs. – | |
| PT | Rs. 200 | ||
| Income Tax | : | Rs. – | |
| F | Deductions | : | Rs. 980 |
| G = C-F | NET TAKE | : | Rs. 16,020 |
| ANNUAL CTC | Rs. 234,124 | ||
Categories: HR Tags: Salary Structure
Monthly Salary Calculations
I have Attached Monthly Salary Calculations
| VISHAL SATISH CHOPRA | ||||||
| Yearly & Monthly Break Up of Gross Salary | ||||||
| Basic 30% | ||||||
| HRA 20% | ||||||
| City Compensatory All. 30% | ||||||
| Conveyance Rs.800 per month | ||||||
| Special Allowance Balance | ||||||
| Yearly | Grand Totals | Monthly | ||||
| Gross Salary | 200,000 | 16,667 | ||||
| Basic | 60,000 | 5,000 | ||||
| HRA | 40,000 | 3,333 | ||||
| City Compensatory All | 60,000 | 5,000 | ||||
| Employers Contribution 12% of basic or Rs. 780/- whichever is less | 7,200 | 600 | ||||
| Conveyance | 9,600 | 800 | ||||
| Special Allowance | 23,200 | 200,000 | 1,933 | 16,667 | ||
| Less : Deduction | ||||||
| P.F. ( Employees Contribution 12% of Basic or Rs 780/- whicever is less | 7,200 | 600 | ||||
| P.F. ( Employers Contribution 12% of Basic or Rs 780/- whicever is less | 7,200 | 600 | ||||
| Professional Tax | 2,500 | 16,900 | 200 | 1,400 | ||
| Net Salary Payable | 183,100 | 15,267 | ||||
| Add Performance Bonus | 30000 | |||||
| 213,100 | ||||||
| Enter Values only in Yellow Cells | ||||||
Categories: HR Tags: Monthly Salary Calculations
Salary Calculation Sheet in Excel
I have Attached Salary Calculation Sheet in Excel
Categories: HR Tags: Salary Calculation sheet in excel
Salary Calculation sheet in excel
I have Attached Salary Calculation sheet in excel
Categories: HR Tags: Salary Calculation sheet in excel
Salary Calculation Sheet in Excel
I have Attached Salary Calculation Sheet in Excel
Categories: HR Tags: Calculation, Excel, Salary, Sheet