**Cost to Company (CTC)** is the salary package of an employee. It indicates the total amount of expense an employer (organization) is spending for an employee in a year. **CTC** is not the actual salary of an employee, it also includes all the facilities an employee is getting during the service period. Thus, **CTC** mostly includes salary, leave travel allowance, bonus, house rent allowance, employer contribution of PF and medical reimbursements. **CTC is usually comprised of several broad components,** 1. Taxable Earnings 2. Taxable Allowances 3. Tax free Reimbursements ( where you pay from your pocket first and then company gives back you that money later upon the submission of proof ) Such money is not taxable. 4. Deductions for various types, Provident Fund deduction being one of the most visible in CTCs.
CTC may have several components: 1. Base Salary/Gross Salary (the actual cash component which is paid monthly) 2. Bonuses (Joining bonus, retention bonus, performance bonus etc.) 3. Stock Options 4. Gratuity 5. Life Insurance 6. Medical Benefits 7. Food expenses (some companies even include this) 8. Cab/Transportation Expenses 9. Training Costs (expenses done on 3rd party) 10. Health Club reimbursements
Anju, CTC refers to cost to company in respect to an employee. This is to mean the total amount paid by the company to an employee by means of his basic salary and different allowances. There is no specified components of CTC, and it differs from company to company. Generally, CTC includes basic salary, PF contribution of the employer and employee, conveyance allowance and medical allowance. Further it may also include food allowance or food coupons, DA, ESIC, travel allowance and also taxes to be paid by the employee and paid by the company of his behalf.