Dear All,
We are a small firm having 35-50 employees. Up to now, we have been following the salary structure as follows:
Basic - Random; most employees receive $6500 as basic
HRA - NIL
Conv - $800 per month
Allowance - Balance Amount (Gross - Basic - HRA - Conveyance Allowance)
Gross - XYZ amount
PF - 12%
PT - As per law
TDS - TDS as per law on Gross Salary
Net - ABC amount
I recently joined, and after reviewing, I have noted some points that I would like to share with you:
1. Basic is random and close to the ceiling limit of PF. I changed it to 30%-40%
2. HRA should be 30%-40% of Basic
3. Allowance should not be a balance amount
4. TDS should not be charged on Gross; PF and PT should be deducted, and then TDS should be calculated.
I understand that none of the amounts should exceed Basic in the salary structure. I want to reframe this salary format and need your help with it. I have never handled the payroll function before, and this presents a new challenge in my role. I seek your assistance.
Thank you.
We are a small firm having 35-50 employees. Up to now, we have been following the salary structure as follows:
Basic - Random; most employees receive $6500 as basic
HRA - NIL
Conv - $800 per month
Allowance - Balance Amount (Gross - Basic - HRA - Conveyance Allowance)
Gross - XYZ amount
PF - 12%
PT - As per law
TDS - TDS as per law on Gross Salary
Net - ABC amount
I recently joined, and after reviewing, I have noted some points that I would like to share with you:
1. Basic is random and close to the ceiling limit of PF. I changed it to 30%-40%
2. HRA should be 30%-40% of Basic
3. Allowance should not be a balance amount
4. TDS should not be charged on Gross; PF and PT should be deducted, and then TDS should be calculated.
I understand that none of the amounts should exceed Basic in the salary structure. I want to reframe this salary format and need your help with it. I have never handled the payroll function before, and this presents a new challenge in my role. I seek your assistance.
Thank you.