How to Reflect a Charity Deduction on Salary Slips? Need Your Advice!

Hi all,

Our company is going to contribute to the Bihar Chief Minister Relief Fund. In this regard, our company's management has decided to deduct one day's salary from every employee's side.

Could anyone suggest how I should place this contribution on the salary slip? Please suggest.

The details of the salary slip are given below:
Basic: 5000.00
P.Tax: 200.00
DA: 10950.00
TDS: 300.00
HRA: 10000.00
Leave taken
Medical Allowance: 1250.00 (Deduction): 00.00
Conveyance Allowance: 800.00 Advance taken
Other Allowance: 00.00 (Deduction): 00.00
GROSS SALARY Rs 28,000.00 GROSS DEDUCTION Rs 500.00

NET SALARY PAYABLE: Rs 27,500.00
Rs Twenty-Seven Thousand Five Hundred Only

In the deductions column, you have to mention the reason as Bihar CM Relief Fund. Don't directly deduct it without mentioning the reason.

Correct me if I am wrong.

Hi,

Calculate one day's salary based on the monthly gross salary and deduct that amount. The PF and PT contributions will also adjust accordingly, and then you can proceed to pay the net salary.

I believe that if you are contributing to the chief minister's relief fund, employees may be eligible to claim tax exemptions for the donated amount.

Hi Siva,
Thanks for your suggestion, yeah we are thinking in tax exemption segments also but I don't know to whom or how I can approach for tax exemption.

Pls. advise ……………

Kind Regds
Rekha

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Good initiative by your company. In addition to the above suggestions, please also ensure you take the consent from the respective employee before deducting a day's pay and also give exemption of tax benefit to respective employees.

We had already took the consent from the respective employees all are agreed for this contribution. I am the only person in HR in my company and I m not aware of couple of things for exemption of tax benefit, should I approach our company's CA for the same

If you know the process then pls. let me know………

Hi,

As far as tax implications are concerned, if your payroll is managed by a third party, then they should be in a position to handle it.

Regards,
Tikam -

Hi,

The amount you want to deduct will be eligible for deduction. Your Accounts department, which prepares your payslip, knows, and you may get in touch with them. However, whatever amount you contribute as a deduction is eligible for IT exemption.

Best Regards,
Dr. P.S.S. Murthy

Your management has made a good decision to include the Cyclone Relief Fund in the payslip.

Regards,
Mouli

If it's getting too complicated, you can ask employees to give checks instead for the contribution. Sometimes employees may want to give less or more than a day's salary.

I fail to understand how this ad about ICFAI is placed here when the subject matter is the contribution to be made to Bihar Flood relief.

Best Regards,
Dr. P.S.S. Murthy