In simple words, payroll is salary process.
On the basis of attendance, salary is calculated for the employees and from that taxes and other legal components are deducted. To calculate payroll, you've to take care of attendance and leave records and then on that basis you can calculate salary for that month for that particular employee.
19th September 2017 From India, Ahmedabad
I really disappointed because views of my post is 40 but only 1 replies in there......
Many people have great experience in HR field then why it is happen?????
I need advise of expertise in HR... to improve my knowledge and skills..
But only 1 replies in there..
Please advice me......
21st September 2017 From India, Nashik
Don't get disappointed, more views to your post doesn't always mean that it was viewed by related persons. There are lots of senior and experienced persons here but sometimes they don't reply as it is either not related to their expertise or the issue is answered by someone else. I think you yourself is in HR, so as a HR, you've to keep yourself calm always and doesn't have to over express yourself. Try to control your emotions, that will nurture you and help you in your career growth.
21st September 2017 From India, Ahmedabad
the total amount of wages paid by a company.
-Payroll is the financial records for employee wages/salaries, withholding, deductions, bonuses, pay for time not worked (holidays, vacations, sick time, etc.) and other items on employee paychecks.
-It can also mean the record of total earnings of all employees for a company in a fiscal year.
-Payroll management system is all about maintaining the records of employees, from recruitment till there retirement. Payroll Management is simply used to build an application program for maintaining the records of employees working in the company.
-A payroll system involves everything that affects the salary of employees such as: Keeping a track record of leaves, records of timings, medical bills and medical leaves for reimbursement, employee loans, child support payments, tax deductions, employee contribution towards PF, etc.
# ASPECTS OF PAYROLL MANAGEMENT SYSTEM:
• Payroll Accounting: Maintaining records of payroll transactions, processing of pay-checks and payments to temporary staff or contract labour.
• Leave Management: Maintaining leave and time record registers, preparing of holiday chart, adjusting the leaves of employees etc.
• Employee Handbook: Preparing a guiding manual for the employees to let them know regarding the company’s policies and procedures.
• CTC calculations: Providing easy CTC break-up calculations in order to plan the tax of employees and reduce their burden.
• Paying dues to Government: Paying of local taxes, tax deductions of employees from salary, employee and employer’s contribution towards PF, etc.
# Under the Statutory Compliance in Indian Payroll System, following are the various applicable laws:
• Minimum Wages Act: It requires fixing of minimum wages for the various skilled and unskilled laborers. It guarantees minimum survival for the workers and helps their families to take care of their education and medical needs as well.
• Payment of wages Act: The Payment of wages Act, 1936 guarantees payment of wages on time and without deductions except those specially authorized by the act. Under the act wages should be paid before the expiry of 7th day of the next wage period where less than 1000 workers are working and before the expiry of 10th day of the next wage period where more than 1000 workers are working.
• Maternity Benefits Act: A Women employee is entitled to maternity leaves of 26 weeks at a rate of her daily average wage for the period of absence maximum to 26 weeks.
• Employees Provident Fund (PF) and Miscellaneous Provisions Act: Every employee and employer is required to contribute an equal percentage of employee’s salary towards public provident fund for which benefit is given to both employer and employee. Employee receives this amount at the time of leaving the job.
• Gratuity Act: Gratuity is the amount given by employer to the employees at the time of leaving of their job when they have completed their five years of service. The employee who has served an organization for a period of five years has the right to receive this gratuity.
• Employee State Insurance Act: ESI fund is maintained by ESIC for the employees earning wages equal to or less than Rs.21,000, so as to provide cash and medical benefits to them and their families.
• Shops & Establishments Act: Every establishment should maintain record of Approval from Department of Labor, maintaining of records of employment, fines, deductions, salary, advances, holidays, etc. Working hours per day and per week should be maintained and working conditions requirement for children should be taken care of.
• Contract labor regulation Act: Contractor may employ contract labor only after obtaining a valid license from the licensing officer. The contract labor should be paid minimum wages and his wages should be paid every month. Proper records should be maintained for contract labor as is done for permanent labor.
• Tax Deduction at Source (TDS): Every employer is required to deduct TDS under section 192 of Income Tax Act, 1961, if the salary is above the highest amount exempt from tax.
• Professional Tax: Professional Tax or employment tax is a state-based tax. It is one of the statutory deductions from the gross income before computing the tax.
**As we knows that processing payroll is a very important function of any business and necessitates an understanding of current regulations, detailed tax knowledge to ensure proper withholding and filing, and a highly organized system that can be relied upon to pay each employee the right amount of money.
For payroll processing you should have a good knowledge of Income Tax Act, keep an updating knowledge of FY Tax Slab, Taxable and Non-Taxable Allowances for Salaried Individuals, TDS knowledge, Statutory deduction and contribution knowledge, expertise in excel spread sheet like v lookup/ pivot table etc., Leave management, How to calculate LWP, in payslip, knowledge of hr & labour laws and many more things which are concern with payroll management.
By using payroll software or outsourcing payroll Organization can help to mitigate stress and minimize errors.
Overall meaning of Payroll is that total amount required to pay workers and employees during a week, month or other period and records wage rates, deductions, and net pay.
In my point of view, using a payroll software is better for organization to minimize payroll error because a payroll software are update with everything which i need.
22nd September 2017 From India, Delhi