How Do I Create a Salary Slip for an Employee with No Tax or PF Deductions?

Dear Sir,

I have an employee, and I will pay him 1 lakh fixed in hand without deducting any tax or PF. Kindly suggest how I can issue him a salary slip. Please share any format if available.

Thank you.

Dear Akhi,

How can you pay a 1 Lakh salary to an employee without deducting TDS? Is it a consolidated salary? Is your company covered under the EPF Act? Is profession tax applicable to your company?

If the employee is getting ₹1 lakh in hand per month, then he has to pay income tax. Therefore, your company will be liable to pay the same along with a penalty for not deducting TDS. An alternative is to gross up the salary to include tax and pay the differential to the government.

Dear Srinath sir,

Our company is covered under the PF & ESIC acts. However, our advocate has informed me that we cannot deduct PF & ESIC for employees whose basic salary exceeds 25,000 rupees, and professional tax is not applicable in Uttar Pradesh. Therefore, we pay a net salary of 1 lakh (without deducting PF, ESIC, or professional tax). Kindly advise on the applicable rate for TDS deduction for the employees.

Thank you.

Regards,

Dear Akhi,

Please update your knowledge in Labour Laws. ESI is not applicable for employees whose monthly gross salary is above Rs 21,000/-.

With regard to EPF, you have to issue EPF Form #11 to all EPF-excluded employees to determine their eligibility for coverage under the EPF Act. EPF contribution is payable on Basic + DA + VDA.

Regarding TDS deduction, please check with your Accounts department.