CCA in salary
CCA in salary is now an essential component of a CTC structure in both for business and companies establishments in the private and public sectors. CCA is payable to all workers and employees who work and live in certain metropolitan regions where the cost of living is higher than the national average. As the cost of living differs from region to region or from one rural or urban region to another, the CCA that you’d be in fact eligible for will also differ correspondingly. The CCA in pay slip is in general worked out on the basis of the scale or grade of pay and not on the basis of basic salary. Many people are not aware of what is CCA in salaryexactly means.
CCA allowance is usually offered to employees living in Tier 1 cities and in some situations Tier 2 cities at the carefulness of the employer. CCA is completely chargeable under the Indian income tax laws. The CCA will be added to the income of a person and tax is calculated as per his respective tax range. The CCA for the employees of an organization in the same city tend to be same for everyone irrespective of their designation or position in the organization. An entry-level employee may get the same CCA compensation as the senior manager of the same organization living in the same area. The CCA does not come under government rules and regulations with the exception of the fact that income taxes are applicable to them. However, DA and HRA have to be calculated as a preset percentage of the salary of an employee. The answer to the question what is CCAis simply anallowance used to retain and incentivize employees in cities and towns where the cost of living is very high compared to employees working in other locations. CCA is similar to DA as it is provided to employees to reimburse for the high cost of living in metropolitan cities and just like DA, it is also fully taxable in an employee's hands.