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Dear Friend,
You can use the following components as salary structure :
1. Basic Salary
2. HRA
3. Conveyance
4. Special Allowance
Gross = 1+2+3+4
CTC= Gross+ Employer's contribution towards PF( 12% OF Basic)+Employers contribution towards ESI( 4.75% OF Gross) + Gratuity( 4.17% of basic).
However you can add some more components or components in some other names.
Regards
Subhabrata Dasgupta
From India, Calcutta
You can use the following components as salary structure :
1. Basic Salary
2. HRA
3. Conveyance
4. Special Allowance
Gross = 1+2+3+4
CTC= Gross+ Employer's contribution towards PF( 12% OF Basic)+Employers contribution towards ESI( 4.75% OF Gross) + Gratuity( 4.17% of basic).
However you can add some more components or components in some other names.
Regards
Subhabrata Dasgupta
From India, Calcutta
Hi!
There is a difference between the concepts 'salary structure" and "salary component". What you have presented is simply a model of what are the possible components of a salary, i.e. basic rate + benefits & allowances.
A Salary Structure refers to the organization's compensation design wherein all the jobs within the company are defined, rated, classified, graded, benchmarked, and given rates (minimum, median, maximum) that are considered to be equitable, competitive, affordable, and sustainable to the organization.
A salary structure is normally designed by specialsts like us within the frameworks of a Job Evaluation Program.
Best wishes.
Ed Llarena, Jr.
Managing Partner
Emilla Consulting
From Philippines, Parañaque
There is a difference between the concepts 'salary structure" and "salary component". What you have presented is simply a model of what are the possible components of a salary, i.e. basic rate + benefits & allowances.
A Salary Structure refers to the organization's compensation design wherein all the jobs within the company are defined, rated, classified, graded, benchmarked, and given rates (minimum, median, maximum) that are considered to be equitable, competitive, affordable, and sustainable to the organization.
A salary structure is normally designed by specialsts like us within the frameworks of a Job Evaluation Program.
Best wishes.
Ed Llarena, Jr.
Managing Partner
Emilla Consulting
From Philippines, Parañaque
Hi, Can anyone help me please?
I am busy with my Certified Financial Planning post gradute diploma, and struggle a lot with a question to structure a partner of a private company's remuneration in the form of salary and dividends in order to obtain the most effective taxable income.
Is there any rules regarding the maximum dividends as part of a salary package?
Must I take the company's after tax profit into account with any calculations?
Ons the SAICA website of chartered accountants I've found theat the optimal mix of salary and dividend will be reached where the salary paid to the individual is taxed at a rate no higher than the rate at which it would have been taxed had it remained and been taxed in, the company's hands. Company's effective tax rate of 34.55% ( 28% fixed tax rate an d 10% STC)
Must I make use of this above calculation in order to structure his current salary of R35 000 per month and R10 000 per annum director's fee, in the form of salary and dividends?
I don't know where to really start at all with this question?
Can anyone help please!
From South Africa, Fietas
I am busy with my Certified Financial Planning post gradute diploma, and struggle a lot with a question to structure a partner of a private company's remuneration in the form of salary and dividends in order to obtain the most effective taxable income.
Is there any rules regarding the maximum dividends as part of a salary package?
Must I take the company's after tax profit into account with any calculations?
Ons the SAICA website of chartered accountants I've found theat the optimal mix of salary and dividend will be reached where the salary paid to the individual is taxed at a rate no higher than the rate at which it would have been taxed had it remained and been taxed in, the company's hands. Company's effective tax rate of 34.55% ( 28% fixed tax rate an d 10% STC)
Must I make use of this above calculation in order to structure his current salary of R35 000 per month and R10 000 per annum director's fee, in the form of salary and dividends?
I don't know where to really start at all with this question?
Can anyone help please!
From South Africa, Fietas
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Creating a Competitive Salary Structure.doc
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