Hello,
I recently got an offer of employment, and the compensation structure is a bit confusing to me, as they didn't specify the NET PAY...
Please explain me about the components of a typical pay structure, wat r the taxable and non taxable components, and how to save IT.
Many thanks in advance..
From India, Hyderabad
I recently got an offer of employment, and the compensation structure is a bit confusing to me, as they didn't specify the NET PAY...
Please explain me about the components of a typical pay structure, wat r the taxable and non taxable components, and how to save IT.
Many thanks in advance..
From India, Hyderabad
Hi
Your salary structure is neat.
The figure quoted as "Gross Monthly Salary" is your net salary (pre-tax). i.e., 345540 - 25000 - ( 0.3 * 95540) is your take home salary per year (assuming that you do not do any savings).
In this salary structure you cannot actually save a lot of money other than the below:
1) Produce rent receipts - on HRA
2) Produce bills of whatever medical expenses you incur (that are not covered in your mediclaim policy) - on Medical reimbursement
3) LTA
Thats all. If you are in the HR of your company, I would suggest lesser bifurcation of the salary structure, probably just one "Other allowances" that would include all kinds of allowances like conveyance, medical reimb, internet connection allowance and so on. This will actually save a lot of taxes for the employees.
I hope my reply has answered your question.
vnd
From United States, San Diego
2Your salary structure is neat.
The figure quoted as "Gross Monthly Salary" is your net salary (pre-tax). i.e., 345540 - 25000 - ( 0.3 * 95540) is your take home salary per year (assuming that you do not do any savings).
In this salary structure you cannot actually save a lot of money other than the below:
1) Produce rent receipts - on HRA
2) Produce bills of whatever medical expenses you incur (that are not covered in your mediclaim policy) - on Medical reimbursement
3) LTA
Thats all. If you are in the HR of your company, I would suggest lesser bifurcation of the salary structure, probably just one "Other allowances" that would include all kinds of allowances like conveyance, medical reimb, internet connection allowance and so on. This will actually save a lot of taxes for the employees.
I hope my reply has answered your question.
vnd
From United States, San Diego
Hi Shaan,
VND is correct about the calculation part.
The amount which is mentioned as your gross salary minus the Income Tax is you net take home salary.
Generally, if you declare your investment at the beinnning of the financial year the IT deductions happen only in the month of January- March next year.
The compensation structure is very comprehensive and very well designed,
# HRA is fifty % of Basic, which is non Texable.
# Conveyance allowance is 800 again non taxable
# Medical allowance upto 15000 per annum is non taxable, if bills are produced.
So, just show some investment like:
Purchase Insurance Policy
NSC Certificates
PPF Account
VPF Scheme if company offers you that, generally all companies do.
If you still have doubts do contact us.
Cheers
Archna
From India, Delhi
VND is correct about the calculation part.
The amount which is mentioned as your gross salary minus the Income Tax is you net take home salary.
Generally, if you declare your investment at the beinnning of the financial year the IT deductions happen only in the month of January- March next year.
The compensation structure is very comprehensive and very well designed,
# HRA is fifty % of Basic, which is non Texable.
# Conveyance allowance is 800 again non taxable
# Medical allowance upto 15000 per annum is non taxable, if bills are produced.
So, just show some investment like:
Purchase Insurance Policy
NSC Certificates
PPF Account
VPF Scheme if company offers you that, generally all companies do.
If you still have doubts do contact us.
Cheers
Archna
From India, Delhi
Hi VND and Archna,
Thank you very much for the information.
I m about to join the organization. so how would u suggest me to go about saving the IT. Would the IT b deducted each month, or annually?
Many Thanks, once again...
Plz let me know your chat IDs, if possible, as interactive talk is always cheerful......... :)
Regards,
Shan.
From India, Hyderabad
Thank you very much for the information.
I m about to join the organization. so how would u suggest me to go about saving the IT. Would the IT b deducted each month, or annually?
Many Thanks, once again...
Plz let me know your chat IDs, if possible, as interactive talk is always cheerful......... :)
Regards,
Shan.
From India, Hyderabad
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