tag:blogger.com,1999:blog-34977282.post5448745047002059174..comments2022-03-15T05:15:38.958-07:00Comments on Geetesh Jain: Geetesh Jainhttp://www.blogger.com/profile/03421701410983792202noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-34977282.post-44081226048599706912007-12-27T01:29:00.000-08:002007-12-27T01:29:00.000-08:00As Geetesh rightly pointed out there would be vast...As Geetesh rightly pointed out there would be vast difference between the promise and delivery.<BR/>I would like to add one more important thing to that list, CTC.<BR/>There are tricks companies use to show a fatter pay, even though the actual take home would be nowhere near the amount. Welcome to the world of cost-to-company (CTC) calculations. The term CTC, used to describe the remunerations offered to an employee on an annual basis, generally includes the basic salary, allowances, perquisites and statutory deductions like professional tax, company's contribution to provident fund, premium toward mediclaim and gratuity. But, sometimes, it might also include the annual performance bonus and interest-rate subsidy (if the firm gives out any), as a result of which, your monthly take-home salary may be way short of the annual CTC divided by 12. Say, the CTC of Rs 5 lakh offered to you includes an annual performance bonus of Rs 1.5 lakh. Now, bonus is given based not only on an employee's performance, but also the profitability of the company or the employee's department. So, sometimes, an employee may work hard enough to deserve the bonus, but may not get any on the ground that his department made losses that year. So, the CTC of Rs 5 lakh may boil down to Rs 3.5 lakh. In addition to these cut-offs, there are taxes to be paid. However, in some packages, the basic salary may be lower, while other perks and allowances are included. As a result, the tax outgo would be lower. This would lead to a higher net take-home pay, taking into consideration the lower tax that one would have to pay. But, in case you intend to take a loan for your home or any other needs immediately, a salary structure that has more perks and less of basic salary may not be suitable. Financers and banks decide the loan eligibility of a person based on the basic salary and not the CTC. If you opt for a CTC with lower basic salary, the amount of loan you are eligible for would be lower.Harihttps://www.blogger.com/profile/10650929778165881321noreply@blogger.com