News > Paying more than 40% of your take-home salary as loan EMI? New wage code to pinch you the most
Paying more than 40% of your take-home salary as loan EMI? New wage code to pinch you the most
Times Now | 12/12/2020 09:01 AM | Click to read full article
From April 2021, take-home salary of private-sector employees is set to fall. As per the new compensation rules, allowances can not be more than 50% of the total compensation.
Typically, most companies keep the non-allowance part of an employee's pay package at less than 50% to reduce their EPF and gratuity liability. The situation will be more difficult for people servicing a loan. Even a 10% reduction in take-home salary will pinch them the most.
