CTC Breakup Guide: How Indian Companies Structure Salary Packages
Every company structures CTC differently. Understanding typical CTC structures helps you negotiate better, compare offers correctly, and predict your actual take-home.
The Three Common Structures
1. Low Basic Structure (30–35% of CTC as Basic)
Used by IT product companies and startups. Lower EPF deductions (since EPF = 12% of basic), higher special allowance, better in-hand. Downside: lower HRA exemption and lower gratuity accumulation.
2. Medium Basic Structure (40% of CTC as Basic)
Most common in IT services (TCS, Infosys, Wipro) and large corporations. Balanced structure — reasonable EPF, reasonable HRA, manageable deductions.
3. High Basic Structure (50–60% of CTC as Basic)
Common in banking, PSUs, and traditional industries. Higher EPF, higher HRA exemption, higher gratuity — but also higher employee EPF deduction and lower special allowance.
Typical Component Percentages
| Component | Low Basic Structure | Medium Basic | High Basic |
|---|---|---|---|
| Basic | 30% of CTC | 40% of CTC | 50–60% of CTC |
| HRA | 40–50% of basic | 40–50% of basic | 40–50% of basic |
| Special Allowance | High (30–40% of CTC) | Medium | Low |
| Employee EPF | Lower (3.6% of CTC) | Medium (4.8%) | Higher (6–7.2%) |
| In-hand (approximate) | Highest | Medium | Lowest |
What is a Flexi-Basket?
Some companies (especially MNCs and IT companies) offer a "Flexi Basket" or "Flexible Benefits Plan" — a pool of money from which you choose which allowances you want. Common options in a flexi basket:
- Fuel and car maintenance allowance
- Driver's salary
- Books and periodicals
- Telephone and internet
- Food coupons / Sodexo vouchers
- Uniform allowance
Allocating your flexi basket to these components reduces taxable income, since they're taxed at lower rates than special allowance.
Components Often Included in CTC That Aren't Cash
- Employer EPF: 12% of basic, paid to your EPF account
- Employer NPS: If your company has NPS, their contribution
- Gratuity Provision: 4.81% of basic, set aside monthly (you get it after 5 years)
- Group Health Insurance: Premium for company medical cover for you and family
- Group Term Life Insurance: Company-paid term insurance premium
- Joining Bonus: Sometimes annualised and included in CTC
How to Negotiate a Better CTC Structure
Since your total CTC is fixed, restructuring can increase your take-home:
- Ask for lower basic and higher special allowance (reduces EPF deduction)
- Maximise flexi basket allocations to exempt components
- Ask for NPS employer contribution (up to 10% of salary, fully deductible under 80CCD(2))
- If possible, ask for meal vouchers/Sodexo rather than food allowance