Hi Team, I have joined a new industry in the NBFC sector. Here, we are hiring new joiners as consultants. I need guidance on how to create a salary breakup for a consultant to avoid PF and ESI deductions. Additionally, I would like to know how to provide salary slips in accordance with Haryana laws as our office is based in Gurgaon. This is urgent. Thank you.
From India, New Delhi
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From India, New Delhi
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When you say 'consultant', I assume you mean that they are professionals and not employees. In that case, they will raise an invoice at the end of each month, and you will pay them like any vendor invoice. Therefore, you cannot give them a salary slip, and no breakup of the salary is needed.
Please note that you will need to deduct 10% TDS on their invoices.
From India, Mumbai
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2508Please note that you will need to deduct 10% TDS on their invoices.
From India, Mumbai
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Professional Fee vs. Salary
Normally, it is termed as a professional fee, and no term such as salary or consolidated salary, etc., should be used. Only TDS will be applicable, and no other deductions, such as PF or ESI, would be applicable on this fee.
From India, Chennai
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Normally, it is termed as a professional fee, and no term such as salary or consolidated salary, etc., should be used. Only TDS will be applicable, and no other deductions, such as PF or ESI, would be applicable on this fee.
From India, Chennai
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First of all, your question and statement are confusing:
Clarification Needed
A. Are you a consultant company that provides people to work in the industry? OR
B. Are you entrusted with the job of giving salary slips to employees?
My Opinion
1. First of all, NBFC Sector - what is the agreement with them? Are they teaching you to avoid PF & ESIC? This is illegal, and the contract will be void if contested.
2. Secondly, if you are a consultant and providing staff as a consultant, you are responsible for taking care of the staff's PF, ESIC, and other applicable taxes. A statement to that effect should be submitted to the company as an addendum to the PF & ESIC department for the employees provided by you on a contract basis.
3. Naturally, you should know the salary structure of employees that are payable and also the statutory deductions towards PF, ESIC, TDS, and others such as loans or any other agreed deductions, thereby arriving at the Net Pay you remit to the employees' bank accounts.
4. Normally, a timesheet is prepared by the contracted company for each employee provided by you, detailing their hours of work every week and month.
5. This is essential for calculating their hours to enable you to raise your invoice for the number of hours your employees worked as stipulated in the contract.
Finally, I should stress PLEASE DO NOT TRY TO BYPASS THE LAWS OF PF & ESIC, which are statutory for the benefit of employees and the working force in India. These laws ultimately stand for the welfare of employees, as you are earning from their hard work. So, do not engage in such acts, even if you are part of a team. Just resign if this is your job, as you are also an employee in the eyes of the law from another angle.
From Saudi Arabia
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Clarification Needed
A. Are you a consultant company that provides people to work in the industry? OR
B. Are you entrusted with the job of giving salary slips to employees?
My Opinion
1. First of all, NBFC Sector - what is the agreement with them? Are they teaching you to avoid PF & ESIC? This is illegal, and the contract will be void if contested.
2. Secondly, if you are a consultant and providing staff as a consultant, you are responsible for taking care of the staff's PF, ESIC, and other applicable taxes. A statement to that effect should be submitted to the company as an addendum to the PF & ESIC department for the employees provided by you on a contract basis.
3. Naturally, you should know the salary structure of employees that are payable and also the statutory deductions towards PF, ESIC, TDS, and others such as loans or any other agreed deductions, thereby arriving at the Net Pay you remit to the employees' bank accounts.
4. Normally, a timesheet is prepared by the contracted company for each employee provided by you, detailing their hours of work every week and month.
5. This is essential for calculating their hours to enable you to raise your invoice for the number of hours your employees worked as stipulated in the contract.
Finally, I should stress PLEASE DO NOT TRY TO BYPASS THE LAWS OF PF & ESIC, which are statutory for the benefit of employees and the working force in India. These laws ultimately stand for the welfare of employees, as you are earning from their hard work. So, do not engage in such acts, even if you are part of a team. Just resign if this is your job, as you are also an employee in the eyes of the law from another angle.
From Saudi Arabia
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Salary breakup format.xls