Know What is CTC and Gross Salary With Explanation

                              If you are in college, or you are working, there is one thing the moment you start working. will be given to you. every month, every single month and that is your salary slip! and salary slip is such a document that we remember only when you apply for another job, and the HR asks for it because on the basis of this, your next offer is decided. 

                  

                      However, it is exactly crucial to understand salary slips because there are some people who think that the CTC divided by 12 months will be our monthly salary. some people think they were offered a lot higher, but then when they received the actual salary, a lot of things got deducted. where did all the money go, how did it go ? for which things do I need to pay my bills, for which I don't have to pay my bills? why is the basic salary so less? It should have been more, which tax slab do I fall under ? so on and so forth. will discuss all that here, understanding your salary slip.

 Know What is CTC - 

                         First thing first, in your offer letter, whenever you get your offer letter once you join a job, there will be one amount mentioned in your offer letter, which is CTC (Cost To Company ) it's crucial to understand this because lots of people are under the illusion they think that CTC let's suppose your CTC is 6 lacks; you feel, wow, every month I will get 6 lack divided by 12, which is 50000 every month. and you convey same to your parents, friends, and even to yourself that now you have a job that will pay you Rs. 50000 every month. No! because this is companies number your number will be different than this  Cost To the Company. the full form will tell you the real meaning of it. 

                    It is an amount that your company directly or indirectly will spend on you every year. In this, naturally, your salary is included, which you will get every month, but there are a lot of other things included, which you might not get directly. or else, you might get it later. provident fund is a part of your CTC, which is mandatory by the government. will see how to calculate it and why it is important. gratuity is included in CTC. If you get insurance, whether it is health insurance or life insurance, that gets included in your CTC. A lot of companies are quite aggressive to inflate CTC or to show that they are offering so much, they end up including training costs as well. so, the training that you will take in the first month, in six months, or the training that you may take in the year, the cost of it gets included by a few companies too. 

                   if you are getting company accommodations, else, your company is offering some freebies or meals, then there are a lot of companies, which is in my opinion are doing wrong, but they do include them all and to know and be aware of them all is important.        

What Does Gross salary mean -  

               Secondly, from this CTC your actual salary, the salary you will get after the tax, after all the possible deduction, that is known as gross salary. this is the amount which might not even be mentioned in the offer letter if they do it, now you will know the meaning of it gross salary is the amount which company doesn't spend on you idirectly, this amount .


What is the difference between Net vs Gross salary ?

Gross salary -  Salary Paid to employe without any tax deduction Known as gross                                    Salary.

Gross salary Formula -

                    Gross Salary = Basic Salary + Home Rent allo. + Other allowance.                                        


Net Salary    -   Salary Received to employe after all deduction Known as gross Salary.


 Net salary Formula -

                    Net Salary = Gross salary - All taxes - PF



Know What is CTC and Gross Salary FAQs


1. What Does Gross salary mean?
   The salary you will get after the tax, after all the possible deductions, that is known as gross salary.

2. CTC Full Form?
    Cost To Company.

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