Question: What Mean CTC?

How is CTC calculated?

It is calculated by adding salary to the cost of all additional benefits an employee receives during the service period.

If an employee’s salary is ₹500,000 and the company pays an additional ₹50,000 for their health insurance, the CTC is ₹550,000.

Employees may not directly receive the CTC amount..

What is the difference between CTC and salary?

The CTC and take home salary of an employee vary as CTC is the sum total of direct benefit, indirect benefit and savings contributions. … Gross Salary: Subtract gratuity and the employee provident fund (EPF) from Cost to Company (CTC), the amount that you get is your Gross Salary.

What is expected CTC answer?

Interview Answer A 30% over your current pay should work well as a general industry standard and let them know that the 30% is the hike on the fixed component over your entire overall salary.

What is mean by CTC in salary?

cost to companyWhile business owners in many other countries may use terms like “gross salary” and “net salary” when referring to an employee’s salary, “cost to company” or CTC is the most common term used in India. This term includes the direct and indirect costs associated with paying an employee.

What is annual income?

Annual income is the total income that you earn over one year. Depending on the data that is required to determine your annual income, you may base your income on either a calendar year or a fiscal year.

How much is deducted from CTC?

Twelve per cent of the basic salary gets contributed from the employee for PF and another 12 per cent by the employer. So 24 per cent of the basic salary gets deducted.

Is PF mandatory above 15000?

EPF eligibility criteria If you are drawing a salary higher than Rs. 15,000 per month, you are termed a non-eligible employee and it is not mandatory for you to become a member of the EPF, although you can still register with the consent of your employer and approval from the Assistant PF Commissioner.

What is current CTC mean?

your current yearly cost to companyCTC means Cost To Company. In general term we call it package. Current CTC means your current yearly cost to company. This includes your in-hand salary + PF deduction + TDS deduction + Any other allowance and deduction company providing/deducting from salary. (

What is CTC format?

CTC full form is Cost To Company. It means total salary package & benefits received by employee in a year including free meals, cabs, interest free loans.

Which is better CTC or gross salary?

Gross salary is the amount after the EPF and gratuity are subtracted from the CTC. Basically, the remuneration paid before deducting the income tax, professional tax, and other deductions. It is inclusive of bonuses, overtime pay, paid holiday amount, and other differentials.

Is PF mandatory?

According to the EPF scheme rules, it is mandatory for an employee to join the EPF scheme if his pay is less than or equal to Rs 15,000 a month.

How do you answer current CTC?

So while mentioning your expected CTC one should take heed the following points: Location of new job. Company status (like, if moving from a startup to MNC) Your job role and responsibilities (if you think there is more workload than the previous company)

What is CTC example?

It refers to the total salary package of the employee. CTC is inclusive of monthly components such as basic pay, various allowances, reimbursements, etc. and annual components such as gratuity, annual variable pay, annual bonus, etc. CTC is never equal to the amount of take-home salary of the employee.

Who are eligible for PF?

It is mandatory for employees having a salary of Rs. 15,000 or more to be a member of this scheme although the employee can voluntarily apply for it at any wage. The employee contributes a minimum 12% of salary (can voluntarily contribute more).

What is new PF rule?

Those earning a basic salary of more than Rs 15,000 a month will now contribute 10 per cent instead of the mandatory 12 per cent contribution towards the PF for the next 3 months till August 2020. … “The move by the government to reduce the 12% PF contribution to 10% will help increase the take home pay of employees.

What percentage of CTC is basic?

Usually, basic salary is 40% to 50% of CTC (Cost to Company). Statutory components such as bonus, PF, gratuity and other benefits are determined on the basis of the basic salary. Any increase or decrease of basic salary can affect an employee’s CTC. Is basic salary taxable?

How much PF is cut in salary?

Currently as per provident fund laws, an individual contributes 12 per cent of the salary to his/her EPF account. An employer also makes a matching contribution i.e. 12 per cent to the EPF contribution.

How much PF is deducted?

Here’s how provident fund contributions are calculated: As per EPF rules, 12 per cent of an employee’s Basic salary+Dearness Allowance is contributed to their Employee Provident Fund account. A matching sum is contributed to the provident fund by the employer.