Allowance : A component in the structure that is paid out to an employee as an earning is termed as allowance. The breakup of the entire salary is mostly done on the basis of base components and allowances. The allowance can be medical allowance, conveyance allowance, etc. Mostly these components are tax exempted by the organisation or requires a document proof for it to be exempted.
Reimbursable Component : A component that is paid out only when the document proof of its usage is provided are known as reimbursable components. The various components that are considered as reimbursable components are medical reimbursements. Claiming for these components to the maximum value is to be done either every month or during the year end.
Recurring Deduction : A deductible component that would be deducted from the gross salary on a regular basis every month are set as recurring deductions. These can be deductions like insurance premium. For the insurance provided, the premium amount has to be deducted every month from the employee’ salary which is created as recurring deduction that automatically deducts the amount while running the payroll.