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Salary is the money that an employer regularly pays to an employee for their work. This payment is often monthly and is detailed in the employment contract.
1. Basic Salary: This is the fixed part of the total salary, usually 40%-50% of the package, and is based on the employee's skills, experience, and qualifications
2. House Rent Allowance (HRA): If an employee lives in rented accommodation, the employer provides HRA, which may be partially or fully exempt from taxes.
3. Leave Travel Allowance (LTA): Employees receive an allowance for travel expenses, and to claim it, they need to provide proof of travel.
4. Special Allowance: This part of the salary structure is fully taxable.
5. Bonus: Employers may pay a performance incentive known as a bonus, which is fully taxable.
6. Employee contribution to the provident fund (EPF): Both the employer and the employee contribute 12% of the employee’s basic salary each month to the EPF. The employee's contribution is eligible for a deduction under Section 80C of the Income Tax Act.
7. Professional Tax: This tax is imposed by the state on employment and has a maximum limit of Rs 2,500 per financial year.
A salary calculator is like a virtual tool that helps figure out how much money you actually get to keep from your salary after all the deductions. You put in your total salary and any bonuses, and the calculator uses a formula to show you the amount after subtracting things like provident fund contributions, professional tax, employee insurance, and finally, what you take home.
To find out your take-home salary using a calculator, you need to input your Cost To Company (CTC) and any bonus, either as a fixed amount or a percentage of the CTC.
Gratuity=(15×last drawn salary×tenure of working)/26
| Parameter | Calculation | Amount (Rs) |
|---|---|---|
| CTC | Rs 10,00,000 | - |
| Bonus | Rs 60,000 | - |
| Gross Salary (CTC - Bonus) | Rs 10,00,000 - Rs 60,000 | Rs 9,40,000 |
| Professional Tax | Rs 2,800 per year (considering Gujarat) | Rs 2,800 |
| EPF (Employee Contribution) | 12% of Rs 20,000 per month | Rs 28,800 |
| EPF (Employer Contribution) | Matching the employee's contribution | Rs 28,800 |
| Employee Insurance | Rs 3,500 per year | Rs 3,500 |
| Total Deductions | Professional Tax + EPF (Employee + Employer) + Insurance | Rs 63,900 |
| Take Home Salary | Gross Salary - Total Deductions | Rs 8,76,100 |
The table includes the relevant calculations and amounts for each parameter.
Step 1: Enter CTC, PF amount, PT amount and other required details.
Step 2: Get the data for take-home salary and deductions.
Step 3: Benchmark your expected salary against industry standards and adjust your negotiations accordingly.
1. Informed Negotiations: Knowing your market value using Suvit’s salary calculator strengthens your confidence and bargaining power during salary negotiations.
2. Career Planning: Make informed decisions about career paths, promotions, and potential salary increases based on data-driven insights from Suvit’s salary calculator.
Don't leave your compensation to chance. Take control of your career journey with the Suvit Salary Calculator. Gain a clear understanding of your earning potential and empower yourself to negotiate fairly and confidently.
