Amit_goyal_2002
Sap Hr Professional
Amitmhrm
Hr Practices
Shish
Consultant
Anjali Singh
H R Executive
Dhruv Rakha
Employee Relations
+1 Other

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Hi Frnds, Greetings! Can anyone help to calculate ESIC. How it would be calculated if the CTC is 10,000K , is there any specific formula to calculate in spreadsheet, if any anyone have this pls. send me. I really need this.
Thanks, Soma

Hi,
ESIC is deducted for the ppl whose Gross is 10,000 or below (be clear tht it is deducted on gross & not CTC. ESIC is calculated @ 6.75%, Employer's contribution being 4.5% & Employee's contribution being 1.25% of the total.
Hope this information helps you.
Bye...

Dear
I have seen the contents for ESI purpose,in this regard I would like to state that the employees getting Gross Salary 10,000/- or below are entitle for ESI benefit. You have to deduct 1.75% from employee contribution & 4.75% from employer's contribution a total of 6.50% to be deposited with ESI on a specific challan with State Bank of India other banks mentioned for this purpose.
with regards
Shish
Delhi

Hi,

Shish is absolutely right. Total ESI contribution is 6.50% of the Gross Salary. All those employees who are getting Gross salary upto Rs 10000/- per month (Effective from 01 Oct 2006. Earlier the limit was Rs 7500/- per month)

have to be covered under ESI. Out of this 6.5%, 1.75% is employee's share and 4.75% is employers share. An employer has to fill up the ESI challans every month and submit the challan to the State Bank of India's branch alongwith the contribution cheque. Cheque has to be drawn in favour of State bank of India ESI account. The challan should be submitted latest by 15th of every month. For collecting the receipt of the Challan an employer has to again go to the same SBI branch after a week's time.

The formula is: Employees' Share- Gross Salary x 1.75/100

Employer's Share- Gross Salary x 4.75/100

Total ESI contribution= Employee's Share + Employer's Share

Note: Gross Salary= All the monthly cash components (Inclusive of incentives)

Should you need any further clarification dont hesitate to ask.

Amit Goyal

Hi Soma,
Shish and Amit are very correct, Earlier the ceiling for ESI contribution was 75oo/- gross salary but now it is 10000/- gross salary.
And the employee contribution is 1.75% of gross salary whereas
employer's contribution is 4.75% of gross salary.
And the total contribution is 1.75+4.75=6.5 %
Hope now it is very much clear with you.
Regards,
Amit Seth.

Hi,
ESIC is applicable for employees whose monthly salary is below 10k. In this employee's contribution will be 1.75% and employer's will be 4.75% and total of 6.5% from the gross salary.Cheque has to be drawn in favour of State bank of India ESI account every month before 15th.
Regards,
Sowmya

Hi All,
Do we have to calculate ESIC seperately for both Gross salary & incentives i.e 1.75% employee contribution & 4.75% employer contribution.
Because if we consider incentives (which can be variable) to be a part of Gross salary as mentioned by Mr Amit Goyal then the salary might vary on a monthly basis & become more than 10000 pm.
Please suggest. Thanks
Also, incase ESIC is deducted for 1 month & the salary is appraised above 10000 pm ESIC would continue to be deducted for 6 months.
Regards
D

Hi,
In case the ESI contribution is paid for the first month of the contribution period and it crosses the limit of Rs 10,000/-, the said employee will remain to be covered under ESI for the complete 6 months. So what do companies, which pays the variable incentives, do is that they keep a apart of the incentive with them and pay it on quaterly basis to the employees as quaterly incentive which does not attract ESI. This exercise is done just to keep employees' salary below 10,000/-.
Amit Goyal

Hi,
In case the ESI contribution is paid for the first month of the contribution period and it crosses the limit of Rs 10,000/-, the said employee will remain to be covered under ESI for the complete 6 months. So what do companies, which pays the variable incentives, do is that they keep a apart of the incentive with them and pay it on quaterly basis to the employees as quarterly incentive which does not attract ESI. This exercise is done just to keep employees' salary below 10,000/-.
Amit Goyal

Hi Dhruv, I forgot to clarify one of ur doubts. No, ESI is not calculated separately for Incentives. It is calculated all together for salary and incentives. Amit Goyal

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