Help Needed On Special Incentives - Doc Download

Hi folks,

I have designed a salary structure. Gross income = BP + HRA + TA + DA + SPECIAL ALLOWANCE. Special allowance is calculated to adjust the difference. Others are calculated on a percentage basis. Net Income = Gross income - deductions. I want to know, if we are giving a special reward to an employee in a month, how the calculation can be shown without disturbing the above one and how will it appear on the payslip?

Hello Maya,

Rewards based on the performance of the employees are not compulsory to show in the payslip. I am not sure about this. In my concern, we don't include the awards given. Instead, we maintain a separate ledger where we post it.

Regards,
Ram

Hi Maya,

I have designed a salary structure. Gross income = BP + HRA + TA + DA + SPECIAL ALLOWANCE. Special allowance is calculated to adjust the difference. Others are calculated on a percentage basis. Net Income = Gross income - deductions. I want to know, if we are giving a special reward to an employee in a month, how the calculation can be shown without disturbing the above one and how will it appear on the payslip?

Agree with the views by Ram. It is not compulsory to show the special reward on the payroll slip. Here you have two options:

- Give a cheque along with the appreciation letter, citing the reasons or instances for which he/she is awarded.
- If the above is not possible, then make a header on the payroll slip called "others" as a provision/contingency where the amount is mentioned.

Please remember either way, this award would be added to his taxable income. It is advisable to use the first option to add a personal touch. After all, this makes a difference, and I am sure he/she will remember this for a long time to come. In fact, I met a gentleman today who is about 45 years old and fondly remembered the cheque and letter given on the occasion of his marriage 20 years ago. 😃 So, go ahead and make a difference in their lives.

Have a great weekend.

Rajat

Hi Ram,

Thank you for the information. The question arose when we developed an HR software for our internal usage. We want to generate the salary monthly automatically. I have a doubt: Is the gross income fixed? Should the incentives and bonuses given occasionally affect the GI, or should they be added to the GI, resulting in a different term?

If the gross income is meant to be the fixed salary, then I believe these incentives should not cause a variation in GI when we consistently provide additional benefits. I hope my doubts are clear to you. If I am handling it manually, I can manage, but once it is automated, I need to be clear. Please provide your suggestions on this as well.

Thank you, Ram.

Regards,
Maya Mathew

Hi Rajat,

Thank you for the reply and information. I have mentioned my persisting issue in the other post. Please give your idea too. I have decided to give a letter to the employee for winning the award. Thanks.

Looking forward to the reply.

Rgds,
Maya Mathew.

Dear Maya,

Well, the practice followed in this neck of the woods is to give the award as a percentage of either: (i) Basic, (ii) Basic + DA, or (iii) Gross Pay. The second system I have sometimes followed is to link the target achieved (Sales target in Rs.) and pay as commission as a percentage of the amount. Both the above methods can easily be programmed into your Salary Generation Software by making a few minor changes.

In conclusion, I would like to say if you are paying on an ad hoc basis, then you will have to do it manually or make some changes in the basic structure of the software if you pay on a slab basis. In the latter, a separate software similar to an Income Tax calculator is created, and the incentive is generated, which is finally linked to your main program.

Please revert for further assistance.

Kind Regards,
SC

Hi Maya,

I get you better as you are developing an in-house software. This means providing a separate column other than the main part in which you can add these rewards because rewards are not given to all and not each time, right? I too suggested this only when we build a software...

Hope this will support you.

Regards,
Ram

Hi Gautam, Ram, Swasthik,

Thank you for the help. I have made a bonus income without affecting the gross income by adding an additional reward column. It will be added to GI if any. The payslip will be given without showing the additional reward. The software is getting ready, and I have to test it live. Once I use it, I may face difficulties. I request you to help me in need as I am new to the HR field.

Thank you very much, friends.

Regards,
Maya Mathew

Dear all,

I've just joined a consultancy and I need to design the Target and Incentive Chart. Kindly let me know the format and calculations as well.

Regards,
Gargee

Dear All,

I am looking for an HR Generalist role in Delhi & NCR with 3 years of experience. My expected salary range is between 18K to 25K. I am looking forward to a positive reply.

Regards,
Gargee
9818167599

Hi all, this is my first message. Can anybody help me with the information? I'm working in a telecom organization where we have retail and marketing departments too. I need to design incentives for them based on targets achieved, i.e., sales of mobile phones. Can someone please advise me on how to proceed with this? Your help in this matter would be greatly appreciated.