Dear All,
i want to know is there any rule for Basic salary & other component. If i want only two head of my salary (Baisc & HRA) then what will be the effect ? Is it possible ?
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Want to know the it rule for basic salary, if any ?
Replies (2)
The main object of company is to give more be tax benefit to employee. So break up the salary in such a way that tax liability of the company as well as employee is reduced. There is no such rules.
Usually break up is done for tax management purpose.
For exmple - If u give 800 pm as basic salary. or if u give the same as transport allowance. then the same is exempt in case of employee.
There are many strategies for tax management.
One rule is applicable that is Mininum wage Act. ( as applicable to the particular state)
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