## Basic Salary
- Basic Salary (also called Base Salary / Basic Pay) is the fixed amount an employee earns, on which most other components (DA, HRA, PF etc.) are computed.
- Fully Taxable – no exemption is available.
## Bonus
- Fully Taxable under the head Salary.
- Bonus is taxed on due or receipt basis, whichever is earlier.
## Commission – Two Sub-Categories
| Type of Commission | Taxability | Why it matters |
|---|---|---|
| Commission on Turnover/Sales (CT) – paid as a fixed % of turnover achieved by employee | Fully Taxable | Forms part of 'Salary' for HRA, Gratuity, Leave Salary computations |
| Other Commission (e.g., flat amount, ad-hoc bonus called commission) | Fully Taxable | Not included in 'Salary' for HRA / Gratuity / Leave Salary formulas |
> Crucial point: Although both kinds of commission are 100% taxable, only Commission on Turnover (CT) is added in the 'Salary' definition used for exemption formulas (HRA, gratuity for non-PGA employees, leave salary, VRS etc.). This distinction is the most common trap in CA Inter problems.