dear all,
i want to kow wt giudelines does one follows when introducing flexi salay structure in company? how is break up of salary done for each employee as per his/ her need? my e mail id is
From India, Thana
i want to kow wt giudelines does one follows when introducing flexi salay structure in company? how is break up of salary done for each employee as per his/ her need? my e mail id is
From India, Thana
Dear Nayani,
You may do it in following ways:-
1. Your Co. may Fix basic (40%-50% as per Company policy of CTC)
2. Your Co. may Fix HRA or DA
And rest of the allowances can be decided by the employee out of few choices given to them with a maximum and minimum limit. i.e. uniform allowance, medical allowance, fuel and maintenance expenses / conveyance allowance, food coupons, gift coupons, children education allowance, leave travel allowance, hostel allowance, entertainment allowance, furnishing allowance etc.
Like Maximum Conveyance Allowance one may opt for is Rs. 800 and in case of a Car one may opt for Fuel Maintenance Allowance instead o Conveyance. The term 'flexi pay' is also called a 'Choice pay'
warm regards,
Umesh Chaudhary
(welcomeumesh@yahoo.com)
From India, Delhi
141You may do it in following ways:-
1. Your Co. may Fix basic (40%-50% as per Company policy of CTC)
2. Your Co. may Fix HRA or DA
And rest of the allowances can be decided by the employee out of few choices given to them with a maximum and minimum limit. i.e. uniform allowance, medical allowance, fuel and maintenance expenses / conveyance allowance, food coupons, gift coupons, children education allowance, leave travel allowance, hostel allowance, entertainment allowance, furnishing allowance etc.
Like Maximum Conveyance Allowance one may opt for is Rs. 800 and in case of a Car one may opt for Fuel Maintenance Allowance instead o Conveyance. The term 'flexi pay' is also called a 'Choice pay'
warm regards,
Umesh Chaudhary
(welcomeumesh@yahoo.com)
From India, Delhi
Hi Nayani,
The contents of the salary break up is as below, you can prepare it at the suitability of your own. HRA would be 50 or 60% of basic.
Basic
HRA
CCA - 825/- is exempted from tax
Other Allowance
Mobile Reimbursement
Medical Reimbursement of 1250/month is exempted from tax
Gross Per Month = Sum of all the above.
Gross Per Annum= 12*Gross/Month
PF Contribution= 12% of Basic/Annum
ESI Contribution = 4.75% of Gross/Annum
Medical = The mediclaim facility provided to an employee who are not covered under ESI as the maximum ceiling for ESI is 10000/Month.
Getting more than this will be covered under Mediclaim or it depends on company policy
EX-Gratia/Bonus = A fixed amount as Bonus
Annual Fixed Gross Cost= Gross/Annum+ Ex-gratia
Annual Total Cost = AFGC + PF+ESIC
Annual total cost is also called as CTC.
Apart from this Food coupons, Holiday package and Furnishing items are included in their CTC.
Hope it must have helped you to clear your queries up to some extent.
Regards,
Amit Seth.
From India, Ahmadabad
The contents of the salary break up is as below, you can prepare it at the suitability of your own. HRA would be 50 or 60% of basic.
Basic
HRA
CCA - 825/- is exempted from tax
Other Allowance
Mobile Reimbursement
Medical Reimbursement of 1250/month is exempted from tax
Gross Per Month = Sum of all the above.
Gross Per Annum= 12*Gross/Month
PF Contribution= 12% of Basic/Annum
ESI Contribution = 4.75% of Gross/Annum
Medical = The mediclaim facility provided to an employee who are not covered under ESI as the maximum ceiling for ESI is 10000/Month.
Getting more than this will be covered under Mediclaim or it depends on company policy
EX-Gratia/Bonus = A fixed amount as Bonus
Annual Fixed Gross Cost= Gross/Annum+ Ex-gratia
Annual Total Cost = AFGC + PF+ESIC
Annual total cost is also called as CTC.
Apart from this Food coupons, Holiday package and Furnishing items are included in their CTC.
Hope it must have helped you to clear your queries up to some extent.
Regards,
Amit Seth.
From India, Ahmadabad
Dear Nikky,
CTC includes flexy as well as non-flexy components..
Flexible components includes those salary heads which can be changed according to employees tax benefits options..
Flexible Pay
HRA
LTA
Conveyance Allowance
Reimbursements
- Books & Periodicals
- Telephone Expenses
- Medical Expenses
- Club Membership
- Car Fuel
- Car Maintenance
- Driver Salary
FBT
Special Allowance
Whereas non-flexible components include those components of salary heads which can't be changed.. it will be decided by the company itself Like Basic, dearness allowance..
Hope it must help you to understand the same..
Regards,
Amit Seth.
From India, Ahmadabad
CTC includes flexy as well as non-flexy components..
Flexible components includes those salary heads which can be changed according to employees tax benefits options..
Flexible Pay
HRA
LTA
Conveyance Allowance
Reimbursements
- Books & Periodicals
- Telephone Expenses
- Medical Expenses
- Club Membership
- Car Fuel
- Car Maintenance
- Driver Salary
FBT
Special Allowance
Whereas non-flexible components include those components of salary heads which can't be changed.. it will be decided by the company itself Like Basic, dearness allowance..
Hope it must help you to understand the same..
Regards,
Amit Seth.
From India, Ahmadabad
Are there any permissible limits for the items mentioned below...
Flexible Pay
HRA
LTA
Conveyance Allowance
Reimbursements
- Books & Periodicals
- Telephone Expenses
- Medical Expenses
- Club Membership
- Car Fuel
- Car Maintenance
- Driver Salary
FBT
Special Allowance
From India, Mumbai
Flexible Pay
HRA
LTA
Conveyance Allowance
Reimbursements
- Books & Periodicals
- Telephone Expenses
- Medical Expenses
- Club Membership
- Car Fuel
- Car Maintenance
- Driver Salary
FBT
Special Allowance
From India, Mumbai
Dear All, I have a query. u/s 10(14) of income tax, what is the limit of Uniform Maintenance Allowance and whether any proof is required to get the income tax exemption? Arun
From India, Vijayawada
From India, Vijayawada
Dear Arun,
It's a good question you have raised.
Under Section 10(14)(ii) of Income Tax, allowance granted to meet expenditure on purchase or maintenance of uniform for performance of official duty is exempted. But the limit in the Act is unspecified. Organisations consider the actual amount sanctioned and incurred by the employee. Many of the companies have different policy for different class of employees therefore the amount of exemption would vary depending up on the employees' role.
I have also attached a informative literature on Income Tax Act.
From India, Delhi
It's a good question you have raised.
Under Section 10(14)(ii) of Income Tax, allowance granted to meet expenditure on purchase or maintenance of uniform for performance of official duty is exempted. But the limit in the Act is unspecified. Organisations consider the actual amount sanctioned and incurred by the employee. Many of the companies have different policy for different class of employees therefore the amount of exemption would vary depending up on the employees' role.
I have also attached a informative literature on Income Tax Act.
From India, Delhi
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