Currently in South Africa, moving to the UK next month. My company is based in South Africa but is also registered in the UK. This ultimately boils down to miscommunication from both ends. I thought the salary amount I was given was a gross salary, But actually it was a Cost to Company (CTC) amount, including employer contributions. So when I put the salary into the UK tax calculator, I was very happy with my net salary per month.
Now my company have just sent me a breakdown which looks like this:
CTC: £xxx
Breakdown of CTC:
Salary: £xxx
Employers pension: £xx
Employers National Insurance: £xxx
So my actual net salary is about £500 p/m less than what I thought.
I just wanted to get people’s thoughts on if quoting the CTC amount is normal in the UK? Are the job postings on places like indeed usually quoting CTC or gross salary?
16 comments
I have never seen a job or indeed advert that gives a ‘Cost to Company’ however I am aware of some American firms who would call that part of the ‘compensation package’.
But as far as I know, CTC is not common.
I’ve never seen CTC in 35 years of employing and being employed. (To clarify, I’ve used those figures internally for budgeting etc, but never presented them to the prospective employee).
Gross salary is normal here. It’s not normal to include costs that the employer must pay, but it is normal to include *your* national insurance contributions and (optional) pension contributions. Are you sure you’re not just reading the breakdown incorrectly?
Never seen CTC at all. As others have said – it’s the gross salary and other benefits that are generally communicated.
I haven’t seen CTC, but I have seen salary + total value of benefits.
Never heard of that at all.
Cost to company isn’t used at all. I’ve not even heard of it before post.
Should be gross.
Gross salary is normal, Cost To company very much is not.
CTC is not something that is usually knowledge employees have here. Only time I’ve heard about it is at very small companies.
CTC was done for about a month (or at the very least it did not last long) at a place I started at (and my offer was CTC)
It was made clear to HR what a completely fuckwitted idea it was.
It’s how much you’re paid before taxes. A company won’t be able to tell you how much you’ll pay after tax because there’s several variables. For example student loan repayments are deducted from our salary before we get paid, the way it works is like a “graduate tax”. But years ago there weren’t any fees, then there were fees and then after a certain point they changed the fees and when they’re repaid. So you could have a 50 year old, a 35 year old and a 25 year old who all went to university at age 18 and even if they’re all paid £30k, the student loan deductions would vary.
What does your contract of employment and offer letter say?
What matters to you is the salary. It will be gross.
Do they not offer a pension contribution scheme or is this a small outfit. Companies will usually have a scheme, and if I’m not mistaken it is obligatory, though the legal requirement is pitiful.
Pension and National Insurance are YOUR contributions/taxes, but the company pays them for you. It is not like they need to pay £x to the government to pay you £y. It is so in some countries but not in the UK.
Salaries are always quoted as a Gross figure in the UK
Most UK employees will pay tax on gross earnings, so whats in your pocket is then net.
Anything above basic is usually a separate figure (Car allowance, bonus, etc)
No because only reason to show this to an employee directly would be to try and justify their salary and explain that they cost the company a lot more than just monthly payroll.
Real negative if they’re to include statutory employer requirements as being part of your compensation offer they have no choice but to pay these its irrelevant.