Basic salary acts as your base income and is the fixed part of your compensation package with the exclusion of benefits and bonuses. The amount of basic salary varies depending on your designation and industry, but commonly it is set at 40 – 60% of CTC.
Allowances
A monetary benefit provided by the employer to meet the expenditures incurred by you to meet the service requirements is called an allowance. These are usually provided in addition to the basic salary. The most common form of allowances is dearness allowance (DA), house rent allowance (HRA), leave travel allowance (LTA), and conveyance or transport allowance. Again, the amount of these allowances might differ from company to company depending on its policies.
CAclubindia
