How Can I Create a Comprehensive Payslip for My Startup IT Company?

I am Keerthi working as an HR in a startup IT company. We don't have any payslip format that includes components such as DA, HRA, PF, ESI, etc. Currently, we only have Professional Tax listed. Could you please guide me on how to create a payslip? Can I include HRA, Basic, and other allowances in the payslip?

Hi Keerthi,

You can add all the contributions in Payslips such as Basic, DA, HRA, Conveyance Allowance, Medical Allowance, Food allowances, etc., as credits and as part of debits such as PT, TDS, etc. If you have enrolled with ESI and EPF, even those can be added to the debits.

Hi Keerthi,

You can include particulars for income as (Basic, DA, Conveyance, Education, etc. allowances) and particulars for deductions as (PT, TDS, EPF (if enrolled)) on the payslip.

As per the Minimum Wages Act of 1948, you are required to provide payslips to every employee in the prescribed format as per Form 11. Payslips should include the following information:

Form XI - Wage Slip - Rule 26(2)

- Name of the establishment:
- Place / Location:

1. Name of the employee:
Father/husband name:
2. Designation:
3. Wage period:
4. Rate of wages:
a. Basic
b. DA
c. Other allowances, if any
5. Total Attendance
6. Overtime wages:
7. Gross payable:
8. Total deductions:
9. Net wages paid:

Pay in charge Employees signature:

Dear Keerthi, There are two aspects of a Pay Slip. One is due to statutory/legal compliance, and the other is to maintain the salary slip contents in a tax-friendly manner. You have not stated the minimum-maximum amount of salary. If the salary of most staff is under the taxable limit, you can add a Medical Allowance as well. You can start some reimbursement, LTA, and Vehicle Fuel/Maintenance policy. This will reduce the tax liability of individuals.

Note that Conveyance Allowance of Rs. 1600/pm is tax-free. Similarly, there are certain limits for HRA as well. Before regulating the contents in the slip, please analyze the tax limits/rebates for each item. Since the Salary Slip format is a strategic and long-term decision, and it involves statutory and legal aspects, it is advisable to have proper homework keeping in view all the points. Being a professional HR person, don’t take any decision which you need to revert in the future (at least due to your mistakes).

Regards

Seeing the spelling mistakes, improper English, and SMS language, I refrained from giving any suggestions. Being a purely professional forum, especially for HR professionals, I expect posters to use spell check, write grammatically correct English, and convey their queries appropriately. The quality of the forum depends on the efforts put in by all members to ask questions, provide answers, and enhance knowledge in a comprehensive manner.