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Meaning & Definition

Net Salary

Net salary is the ‘take home’ salary of an employee after statutory deductions such as taxes are made from the gross salary. Net salary is the amount an employee receives after the statutory deductions. Net Salary is the actual amount which is credited to the bank account of an employee. Income Tax is based on the Gross Pay of an employee.

Net Salary = Basic + Additions (Bonuses, Allowances) – Deductions.

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