Hello Seniors,
I am working in IT company and we have recently initiated and involved in PF and ESI. The management has introduced a variable pay and it affects the PF monthly contribution. I have many doubts in the salary structure. Let me explain how the salary is calculated here and then go for the doubts.
1. Basic pay is calculated at 60% of Gross pay -
2. HRA is 50% of Basic pay
3. Rest of the gross pay is Special allowance (i.e 10%)
Gross Salary = Fixed and Variable (No percentage wise calculation, just some number) (22000+4000)
Deductions:
PF - 12%
ESI - 1.75%
PT -
Theses deductions are not included in the Gross pay.
My Doubts:
1. Basic can be 60% of GP?
2. Can we separate the variable pay from PF(PF only for fixed pay can be done)? If so, LOP has to be on FP.
3. HRA - Already the basic pay is high and how come the HRA can be calculated at 50 % of Basic pay.
4. If I include the deduction amount in Gross pay, then the entire number will change. Should I do that or ignore it.
Hope I explained it clearly. Please do help me on this.
From India, Madras
4I am working in IT company and we have recently initiated and involved in PF and ESI. The management has introduced a variable pay and it affects the PF monthly contribution. I have many doubts in the salary structure. Let me explain how the salary is calculated here and then go for the doubts.
1. Basic pay is calculated at 60% of Gross pay -
2. HRA is 50% of Basic pay
3. Rest of the gross pay is Special allowance (i.e 10%)
Gross Salary = Fixed and Variable (No percentage wise calculation, just some number) (22000+4000)
Deductions:
PF - 12%
ESI - 1.75%
PT -
Theses deductions are not included in the Gross pay.
My Doubts:
1. Basic can be 60% of GP?
2. Can we separate the variable pay from PF(PF only for fixed pay can be done)? If so, LOP has to be on FP.
3. HRA - Already the basic pay is high and how come the HRA can be calculated at 50 % of Basic pay.
4. If I include the deduction amount in Gross pay, then the entire number will change. Should I do that or ignore it.
Hope I explained it clearly. Please do help me on this.
From India, Madras
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