Salary Cut Implementation: Reflecting on Salary Slips
If an organization has decided to implement a "Salary Cut" with the consent of the employees for a temporary period, how can the same be reflected on the salary slips without changing the basic salary or affecting the retirals? Additionally, we need to ensure that since the employee is already sacrificing their salary, they do not have to pay extra taxes due to the salary reduction. I would like your views on how this deduction can be made, under what headings, and how the employee can avoid paying full taxes as they are experiencing a temporary (e.g., for 3 months) loss in salary.
Since this is a sensitive issue related to employee finances, I would appreciate your honest suggestions.
Best Regards,
Puneet
From India
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5If an organization has decided to implement a "Salary Cut" with the consent of the employees for a temporary period, how can the same be reflected on the salary slips without changing the basic salary or affecting the retirals? Additionally, we need to ensure that since the employee is already sacrificing their salary, they do not have to pay extra taxes due to the salary reduction. I would like your views on how this deduction can be made, under what headings, and how the employee can avoid paying full taxes as they are experiencing a temporary (e.g., for 3 months) loss in salary.
Since this is a sensitive issue related to employee finances, I would appreciate your honest suggestions.
Best Regards,
Puneet
From India
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You will have to share the salary structure of the company so that the fellow members can suggest some ways out. For example, I would suggest a reduction in HRA, but if the HRA is linked to Basic, then the suggestion would not work. For members to give a suggestion, they need to know the whole situation.
Regards,
Preetam Deshpande
From India, Mumbai
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Regards,
Preetam Deshpande
From India, Mumbai
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1. Reduce the allowances, as this will keep basic and retirals intact.
2. Tax is computed on income in hand and the relevant tax brackets/slabs, so there is no question of undue taxes.
Hope this answers your queries.
Regards,
Kalpana Iyer
From India, Pune
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2. Tax is computed on income in hand and the relevant tax brackets/slabs, so there is no question of undue taxes.
Hope this answers your queries.
Regards,
Kalpana Iyer
From India, Pune
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