From employees to the employer, everyone needs to calculate monthly or yearly CTC at one point. And, this CTC Calculator is the best option you've got on the internet. You'll get a detailed breakdown of the CTC. This tool should be your primary destination for effective CTC calculations. For your information, it is known as the Cost to Company. Using this tool, individuals can determine the total costs of the employee handled by the company. The breakdown of the entire sum will provide you a lot of insights. Go ahead and start using this tool as per your needs. Further, you'll learn more about this CTC Calculator tool.
What's The Full Form of CTC?
The CTC stands for Cost To Company. In simple words, it is a sum of expenses handled by the company for each employee. Total costs of an employee to the employer is the CTC figure.
What Is This CTC Calculator Tool?
This tool can help you know everything about an employee's CTC. You'll get a complete breakdown of the total amount of money spent on an employee by the company. The CTC can be either monthly or yearly. There are several elements of this total compensation cost of an employee that are paid by the employer.
To be specific, CTC consists of an employee's basic salary, allowances, bonus, PF, insurance, etc. This CTC Calculator will present an elaborate breakdown of all these elements. You'll be able to understand everything about the CTC deeply and clearly.
Different Elements of The CTC Calculator Tool
- Basic Salary: This is the main element showcased by this CTC Calculator tool. Every employee has a fixed amount of wages that is disbursed on a monthly basis. This is called the Basic Salary paid by the company and mentioned in the employment contracts. Undeniably, a major chunk of the CTC figure is the Basic Salary amount.
- Allowances: Elements like HRA are also included in this tool's calculation results and breakdown. This is one of the many Allowances offered by the company. Being separate from the salary, these allowances target the employee's needs. You'll get a complete breakdown of the medical allowances, House Rent Allowance (HRA), etc.
- Incentives: It is common for employees to get bonuses based on their performance. If they have contributed a lot to the company's growth, the employees are offered these incentives as appreciation. Anything that is rewarded to the employee as a variable pay, bonus, or incentive is also a part of CTC.
- Employer's Contributions: This CTC Calculator tool doesn't leave out the contributions made by the employer. An employee gets PF (Provident Fund), Insurance Premiums, Gratuity, etc. Being paid by the employer, these contributions have to be mentioned in the CTC.
- Benefits: Aside from everything mentioned above, an employee also gets secondary benefits. Hence, the CTC also includes the costs of company sponsored tours, meals, events, etc.
Overview of This CTC Calculator Tool
Being reliable, this CTC Calculator is in high demand among those associated with the corporate world. The effective calculations and CTC breakdowns are very insightful. You are ensured to get precise results without any delay. Due to smart algorithms, this CTC Calculator tools works really fast. There are no cause for concerns as this tool doesn't make mistakes. In contrast, manual calculations are prone to incorrect results. By breaking down the CTC figure into multiple elements, this tool helps you understand in better way.
From Basic Salary to HRA, bonuses, taxes, etc, everything is given equal importance by this tool. In other words, different elements of CTC are described elaborately. Everything that an employer paid to the employees is a part of these CTC calculations. Indeed, this tool is highly recommended for all the employees and company officials. Accuracy is a major priority for this tool which helps uplift the entire calculation experience for the users. In the end, this CTC Calculator tool even allows you to download the results in a PDF file.
How does this CTC calculator work?
Despite the simplicity, the smart algorithms enable this tool to present effective CTC calculations. It's not hard to understand the working of this tool. The credit for the authentic and precise results go to formulas and proven concepts. When combined with the algorithms, this tool becomes very insightful. The process of getting a CTC breakdown includes a few easy steps. First, you have to provide a specific monthly or yearly CTC Amount. Right beside the amount you'll have to select the CTC type i.e., yearly and monthly. Thereafter, this tool demands various details about your salary structure like basic salary, bonus, and HRA. Please note that all of these values have to be provided as a percentage. Lastly, this CTC Calculator tool will ask you to select a specific tax regime. You have two options - New Tax Regime and Old Tax Regime.
Step-by-step Guide - Downloading PDF File of The CTC Calculator Results
By following the steps provided below, you'll be able to download the CTC breakdown results in PDF format:
- Open the official CTC Calculator tool.
- Thereafter, enter a specific CTC amount and also select the CTC type (monthly or yearly).
- Other inputs you have to provide are basic salary, HRA, and Bonus. All of these values are supposed to be in percentage.
- After choosing between the New Tax Regime and Old Tax Regime, go ahead and click on "Calculate Salary".
- Once all the CTC calculations and breakdown results are presented, you'll get the "Download PDF" option. The PDF file will include all the results like annual CTC, basic salary, HRA, bonus, employee PF, income tax, etc.
What Is The CTC Tax Regime?
A total of two tax regimes are offered by the Income Tax department. This includes the old and the new tax regimes which work parallel to each other. Both of these regimes coexist and individuals have the right to choose any of them. The New Tax Regime applies by default on companies and their employees. That is unless the employee specifically choose the Old Tax Regime. While making the decision, employees have to consider all the potential tax benefits. From their total income to tax deductions, both of the tax regime offers different benefits. The variations of the tax rates and standard deduction sets these tax regimes world apart. The differences between the Old and New Tax Regime are mentioned down below.
How Are The New & Old CTC Tax Regimes Different?
| New Tax Regime | Old Tax Regime |
|---|---|
| This regime is applicable by default on companies and employees | The employee has to opt for this regime during the ITR filing process |
| Tax rates are low with progressive slabs | Traditional slabs are used alongside higher tax rates |
| Key deductions like 80C, 80D, and HRA are not allowed | Many types of deductions and exemptions are allowed |
| Salaried individuals can have a standard deduction of INR 75,000 | Standard deduction of INR 50,000 |
| No HRA exemptions as it is fully taxable | HRA amount is partially exempted from tax |
| Limited exemptions in terms of PF or other allowances | Multiple exemptions are offered for PF and other allowances |
| Non-business salaried individuals can switch regimes every financial year | Non-business salaried individuals can switch regimes every financial year |
| People with business income can switch this regime only once in a lifetime | Business income individuals can opt for the Old Tax Regime only once |
| Income below INR 12 lakhs is tax-free | Income up to INR 5 lakhs is tax-free |
| Salaried individuals with fewer deductions may find this regime suitable | Individuals with multiple deductions and investments benefit more |
What is Basic Salary?
Basic salary is a sum of money that is disbursed into your bank account every month by the company. This amount is mutually agreed upon between the employee and the employer. Indeed, Basic Salary is exactly mentioned in the employment contracts. Please note that it isn't the same as the in-hand salary. For your employment and work, this basic salary is a compensation. It doesn't include any bonus pay or allowances. The biggest part of the CTC figure is formed by Basic Salary. If an employee gets an increment, their basic salary for the financial year is updated accordingly.
What is HRA?
In simple words, you can understand it as money for living accommodations of the employee. HRA stands for House Rent Allowance. This is especially for the employees who have shifted to a new city for work purposes. The company employer pays this special allowance for residence regularly. An employee's housing cost is entirely covered by this allowance. However, HRA is only received as long as you are employed. The New Tax Regime considers your HRA to be fully taxable. Whereas, you can get partial HRA tax exemptions in the Old Tax Regime.
What is DA?
The full form of DA is Dearness Allowance. It can be described as adjustment money for cost of living. Many kinds of employees in the public and private sector are known to receive DA money. Moreover, the amount is a specific percentage of the employee's basic salary. Under the law, your DA is completely taxable under both tax regimes.
What is PF?
As you may know, PF is known as a Provident Fund. This is a fund for your future retirement paid by the employer. It's the company's contributions for your retirement. Once an employee takes retirement, these PF savings are extremely beneficial. Aside from money, the shares of the company are also offered as a part of PF. The governance and handling of PF is done in accordance with the rules of EPFO.