How Do I Create a Salary Structure for a Small Start-Up Without PF or ESI Deductions?

Hi, we are a start-up and we are hiring an employee with a salary of 40K. However, I don't know how to create a salary structure. Our company currently has a size of 5-10 employees and we do not deduct any PF or ESI. Can you please advise on how to create a salary structure, including determining the basic salary and other allowances or wages?

Salary Structure Guidelines

You can prepare a salary structure according to the standard salary breakup heads.

Basic - 50% of gross

HRA - 40-50% of basic

Conveyance - 1600

Medical - 1250

Children's education allowance - 200

Special allowance - balance

This structure is standard for high-salary individuals. For those with lower salaries, such as those not earning high amounts:

Basic - as per the minimum wage

HRA - 40-50% of basic

Conveyance - as per calculation but not more than 1600

Medical - as per salary but not exceeding 1250

Special Allowance - balance

PF and ESIC Calculation

PF calculation - earn basic * 12%

ESIC - earn gross * 1.75%

Thanks & Regards

Whose basic salary is less than or equal to 15000, you have to deduct his PF, and whose gross salary is less than or equal to 15000, deduct his ESIC.

Thank you.

Hi,

Few companies are not paying PF and ESI. How is it possible to pay salaries, and in which account is it showing if they are not paying?

Regards,
MANI