ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Net salary, also known as take-home salary, is the amount of money that you will receive after all deductions. The deductions are made from the CTC and include things like income tax, Professional tax, Public Provident Fund (PPF), etc. Net salary is usually lower than the gross salary.

Detailed explanation-2: -Net pay is the amount after various deductions like PF, Income Tax, etc. We have mentioned the sum total of gross salary is to be deducted from eligible deductions to get the net pay. The components that get deducted from the gross salary include: Employee’s PF Contribution. Professional Tax (state-specific)

Detailed explanation-3: -Income Tax, in this case, is deducted at source by the employer and is based on the gross pay of the employee. Also, basic salary of an employee should be at least 50%-60% of his/her gross salary.

Detailed explanation-4: -Gross salary is the amount received by an employee without any tax deductions. Net salary is the amount that an individual receives after all deductions have been taken out. Gross salary = Basic salary + HRA + Other allowances. Net salary = Gross salary – Income tax – Provident Fund – Professional tax.

Detailed explanation-5: -Yes, TDS on salary is deducted every month. As per Section 192, the employer will deduct TDS on salary at the time of making the payment to the employee. Since the employee gets a salary every month, the employer will make a deduction for TDS on salary every month.