Difference between take home salary and CTC

Hi,

Looking for a detailed blog or article for quick employee reference on various difference between take home salary and CTC?

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Hi Chitra,

CTC is a concept adopted by employers mostly in countries like India, Pakistan, Egypt and some other African countries. As the abbreviation stands for " Cost to Company ", it refers to all the expenses incurred by the employer per employee on annual basis. Therefore, it includes the gross wages payable to an employee at the end of the wage period under the contract of employment multiplied by 12 and all other statutory payments like employer’s contribution to EPF, ESI,Gratuity Fund, bonus and other fringe benefits like LTA, Medical reimbursement etc. In short, CTC is an accounting tool to project the overall cost per employee per annum to be incurred by the employer.
“Take Home Salary” on the other hand is the amount received by an employee after all statutory and authorised deductions from the gross monthly salary.

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Salary Head
A - Fixed Remuneration
Basic Salary
House Rent Allowance
Other Allowance
TOTAL - A
B - Statutory Benefits
Employer Contirbution to Provident Fund
Statutory Bonus
Gratuity
Employer Contirbution to ESIC
TOTAL - B
C - Other Benefits
Mediclaim Premium
Life Insurance Premium
TOTAL - C
TOTAL COST TO COMPANY ( A + B + C )
D - Statutory Deductions
Employee Contirbution to Provident Fund
Professional Tax
Employee Contirbution to ESIC
TDS
Loan/Advance
TOTAL - D
MONTHLY NET PAY ( A - D )
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Hi,

  1. CTC is including everything what company pays you “Your Salary” + “Benefits” like PF,ESI,Gratuity, Insurance etc.
  2. Net is from “Your Salary” - "Deductions’’ like PF ,PT, ESI, Loan,TDS
    ||FIXED COMPENSATION|
    ||Basic Salary|
    ||House Rent Allowance |
    ||Food Coupons|
    ||Flexible Benefit Package & Other Allowances|
    ||Total Fixed Compenstion----(A)|
    |||
    |B|EMPLOYER BENEFITS|
    ||Contribution to Provident Fund|
    ||Contribution to ESI|
    ||Statutory Bonus#|
    ||Gratuity|
    ||Medical Insurance|
    ||Accident Insurance|
    ||Total Benefits-----(B)|
    ||TOTAL COMPENSATION AND BENEFITS Cost-to-Company (CTC) : (A) + (B)|

NET SALARY DETAILS
||FIXED COMPENSATION|
||Basic Salary|
||House Rent Allowance |
||Food Coupons|
||Flexible Benefit Package|
||Statutory Bonus#|
||Total Fixed Compenstion----(A)|
|||
|DEDUCTIONS
|Provident Fund|
||Professional Tax|
||ESI|
||Food Coupons|
||Income Tax *|
||Total Deductions|
|Net Take-home Salary||

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