Category: Payroll

Categories
Payroll

Payroll calculation in India , Salary break up and Deduction.

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Payroll can be defined as the process of paying a companys” employees.

It includes collecting the list of employees to be paid, tracking the hours worked, calculating the employees pay, distributing the salary on time, and recording the payroll expense.

In order to get this done , there is tons of background work involved because payroll is more than just about calculating paychecks .It is an intricate set of process which requires different teams to work in tandem, But all this complexities can be managed effortlessly by the standardization of processes, selecting the right service delivery model, and using modern technology to manage payroll operation.

Steps involved in completing to payroll.

  1. Onboarding employees to payroll.
  2. Defining your organizations pay policy.
  3. Creating your salary components for all compensation structure.
  4. Collect payroll input from employees and dependent items.
  5. Compute the salary to be paid for all employees.
  6. Distribute authentic payslips, and tax worksheets.
  7. Compile tax reports.
  8. Complete tax filing for all the statutories (PF,LWF,ESI,TDS)

3 STAGES TO RUN INDIAN PAYROLL

Stages to process Payroll in India

Stages of Payroll

Leave and attendance data : To accurately process payroll , one of the most important activities in payroll is calculating the time that an employee has invested in a given pay period. Attendance data is the key input for processing payroll as almost all the other calculation based on it. Any error at this step will inveriably lead to wrong calculation of employee”s compensation, causing employees dissatisfaction. For the HR departments too, it is a time consuming activity. Along with attandance , it is also important to track whether the employee is spending the stipulated amount of time at work.

Data requirements to run a payroll

person holding fan of 100 us dollar bill
PAYMENTS AND DEDUCTIONS

Payments and deductions:

One more set of most crucial data to be collected as part of pre payroll is the information regarding payments and deductions to be made to employees. Payments and deductions data for the specified period helps how much to be paid as salary to a particular employee.

Income tax information: According to section 192 of Income Tax Act , the employer is responsible for deducting income tax (tax deducted at source) while paying salaries to the employees. This deduction is based on the estimate of the income that will be earned in the particular financial year and the applicable tax rate.

As most employee make investment to save tax , organization ask their employees to declare their investments at the start of the financial year. Based on this declaration of tax saving investments, the organization calculates the taxable income and the projected tax , which the employee is liable to pay the financial year. This tax then deducted on monthly basis as tax deduction at source.(TDS).

New joinees

Anew joinee needs to be added with all data records (such as PAN NO,Address information,dependent information),salary structure and benefit deductions.To allow accurate calculation of taxex , you also need to capture prior salary informatio through Form 12B.

To allow that payroll calculations for new joinees is accurate and does not disrupt the process for all other employees , identify a cut off date, post which you will not include the new joinee in the current months” payroll.

Data validation before actual payroll process :

Data validation is the most foremost step of pre- payroll ,which cannot be avoided regardless of any cost. The collected data is checked for accuracy and correctness before using it in the actual payroll process. It is important to confirm that the background work done so far as part of pre payroll is error free to ensure that the sub sequent activities of payroll run smoothly. Inaccurate data can menance the entire payroll process.

Exits:

Many companies stop the payroll run for employees who have handed in their resignations .This is tricky – especially in cases where employees just stop coming to work post the pay period end date. (eg. absconding employees ).But can be achieved if we saparate the payroll processing and disburse processes.

Validation is a proactive step in the sense that it eliminates the risk of committing mistakes in payroll and the consequences faced while retifying them later.

Arrears:

An employee’s salary may have changed in a prior period because there was a delay in the performance increment cycle .

The salary changrs will need to be paid restrospectively and this calculation is called Attear calculation. The calculation will include additional income, increased tax and deductions.

Let us now discuss common salary components:

Basic salary

Basic salary is the base income of an individual. It is a fixed part of one’s compensation package.

A basic salary depends on the employee’s designation and also the industry in which the employee works.

Gross salary

Gross salary is the amount calculated by adding up one’s basic salary and allowances, before deduction of taxes and other deductions. It includes bonuses, over-time pay, holiday pay, and other differentials.

Gross Salary = Basic Salary + HRA + Other Allowances

Net salary or take-home salary

Net salary or take-home salary is obtained after deducting income tax at source (TDS) and other deductions as per the relevant company policy.

Net Salary = Basic Salary + HRA + Allowances – Income Tax – Employer’s Provident Fund – Professional Tax

Basic salary

Basic salary is the base income of an individual. It is a fixed part of one’s compensation package.

A basic salary depends on the employee’s designation and also the industry in which the employee works.

Gross salary

Gross salary is the amount calculated by adding up one’s basic salary and allowances, before deduction of taxes and other deductions. It includes bonuses, over-time pay, holiday pay, and other differentials.

Gross Salary = Basic Salary + HRA + Other Allowances

Net salary or take-home salary

Net salary or take-home salary is obtained after deducting income tax at source (TDS) and other deductions as per the relevant company policy.

Net Salary = Basic Salary + HRA + Allowances – Income Tax – Employer’s Provident Fund – Professional Tax

Allowances

An allowance is an amount received by the employee for meeting service requirements. Allowances are provided in addition to the basic salary and vary from company to company. Some common types of allowances are discussed below:

  • HRA or House Rent Allowance: It is an amount paid out to employees by companies for expenses related to rented accommodation.
  • Leave Travel Allowance (LTA): LTA is the amount provided by the company to cover domestic travel expenses of an employee. It does not include the expenses for food, accommodation, etc. during the travel.
  • Conveyance Allowance: This allowance is provided to employees to meet travel expenses from residence to work.
  • Dearness Allowance: DA is a living allowance paid to employees to tackle the effects of inflation. It is applicable to government employees, public sector employees, and pensioners only.
  • Other such allowances are the special allowance, medical allowance, incentives, etc.

Reimbursements

DEDUCTIONS

This is where real work towards reaching the net compensation of employees happens, in the way of finishning the pre-payroll activities .This is the time when accumulated payroll data ( Leave & Attendance data , shift wise calculations, Tax and Deductions ,Expenses, Incentives) during pre-payroll should run.

Structuring salaries in an inevitable task for every HR and Payroll professional . Despite the importance of the activity , professional are often uninformed of the technical and best practices of a drafting a complete and efficient salary structure.

Through this article we will look atvthe various components of a salary, what they mean and how you can use them effectively.

components:

BASIC FULLY TAXABLE.

DA FULLY TAXABLE.

MEDICAL FULLY TAXABLE

CONVEYANCE FULLY TAXABLE.

HRA MINIMUM OF THE FOLLOWING.

1) ACTUAL HRA RECEIVED.

2)RENT (-) 10% OF BASIC.

3) 40% OR 50% OF BASIC( IN METRO 50%,OTHERWISE 40%)

LTA As per actuals of the fare expenses.

SPECIAL ALLOWANCE FULLY TAXABLE.

Children Education Allowance rs 100 monthly for each child upto 2 children.

DEDUCTIONS.

PROVIDENT FUND EMPLOYEE AND EMPOYER BOTH DEDUCT12% OF BASIC.

ESIC EMPLOYER CONTRIBUTION 3.25%, EMPLOYEE CONTRIBUTION 0.75%.

PROFESSIONAL TAX VARIES FROM STATE TO STATE.

LABOUR WELFARE FUND VARIES FROM STATE TO STATE.

Deductions

Deductions are part of the salary that are the part of the CTC but are deducted from the in-hand salarythat employees receive.Let”s take a deeper look at some of the most common salary deductions and what they mean.

  1. Provident Fund(PF)- is calculated 12% of basic +DA+special allowance .The employer and the employee both make an equal contribution of 12% eac h. This is applicable to companies who have 20 or more employees on their payroll.
  2. Employees state insurance corporation(ESIC)- Deductions towards ESIC are mandatory for employees whose gross salary is not more than 21000.It is only applicable on the companies where 20 or more employees within the 21000 gross salary bracket. Employee have to make a contribution of 0.75% and employer 3.75%.
  3. Professional tax – Professional tax is a tax levied by Government of certain state on salaried employees. The states where professional tax is applicable are Karnataka ,Bihar, West bengal , Andhra pradesh, Telengana,Maharastra,Tamil nadu, Gujarat, Assam, Chhattisgarh, Kerala, Meghalaya, Odisha, Tripura, Madhya pradesh , and Sikkim . The contribution amount varies from state to state where they are applicable.
  4. Labour welfare fund:_ Labour welfare fund , as the name suggest , is a contribution made by salaried employees for the benefit of labour class. This contribution is applicable in the state of Karnataka, West bengal, Maharastra , Andhra pradesh, Kerala, Goa, Delhi, Punjab, and Haryana, Madhya pradesh. The contribution amount varies from state to state and relatively small. The employer and the employee both make the contribution and employer pays approximately twice the employee contribution. Like professional tax labor welfare fund contribution also varies from state to state.
  5.  Once, you run the complete payroll process, manually or through any system, your senior authorities as per your company culture, may ask you for the reports such as department wise employee cost, location wise employee cost, etc. As a payroll officer, it becomes your responsibility to dig into the data and extract the required information and share the reports. These reports are automatically created by the professional payroll software whereas; some organizations invest a lot of time in creating those reports manually.

Thanks for Reading.

Rupa Banerjee – Payroll Editor

Categories
Payroll

Payroll Management System in India

PAYROLL MANAGEMENT SYSTEM is one of the most important function of an organization. It works on compensation of employees which contains attendance and leave management, advances , loans, bonuses, tax deductions, stat. compliance in accordance with the organizations policies. Apart from distributing pay checks to the employees , of salary is important a lot of time consumes in the areas of payroll management such as calculating tax deduction, statutory compliance.

Every time flipping through numerous files to respond to the employee queries  is again a time-consuming task. Employee for whom monetary salary is the only source of income .  Imagine what if the salary is not paid accurately or delay in releasing salary. Such irregularities can take a toll on the morale of the employees and ultimately affect  the business productivity. While ensuring accurate and timely payment is important , adhering to the various laws and regulations such as labour law, PF, P TAX,  and other statutory  compliance is also critical. Non- adherence with these laws can attract serious legal and financial  consequences.To make sure that your employees are happy and   you are law compliant, you need to have a proper understanding of what payroll is and how to run payroll effectively. we will start with the basic of payroll.

WHAT ARE STAGES TO PROCESSING PAYROLL?

A payroll PROCESS needs to do careful planning. There are always ongoing tasks that needs attention and a constant need to monitor changes to withholdings, contribution to social security funds ,etc. The entire process can be spilt into three stages , pre- payroll, actual payroll and post payroll activities.

Key benefits of a payroll management system

There are several benefits of implementing a service like this for your business. Some of them have been briefly highlighted below:

  • Employee morale – By making sure your employees are paid in a systematic and timely manner, you are reinforcing their faith in your business’ financial integrity. This will boost employee morale and motivate them to perform better. 
  • Statutory compliance – This refers to the legal framework your business must adhere to. As an employer, you are required to maintain various payroll and payment records of your employees. Every organisation that hires employees and pays salaries must comply with the labour laws. By having a payroll process in place, you are automatically complying with the employment and labour laws in India.
  • Manage employee information efficiently – You will be able to accurately store and manage all your employee information in one place. There will be no need to use any additional tool for this purpose. 

Core components of payroll processing in India

  • SALARY
  • GRATUITY
  • Housing Rent Allowance (HRA)
  • Dearness Allowance (DA) – Subject to the city of employment
  • Special allowance
  • leave Travel Allowance (LTA)
  • Maternity leave
  • ESIC
  • Provident fund

Let us start our discussion with salary

A salary is a form of payment from an employer to employee, which may be specified as an employment contact. As per income tax act 1961, income of a person is computed under the five heads-

IN payroll income from salary and income from house property is considerable.

1. Income from salary

2. Income from house property

3. Income from business and profession.

4. Income from capital gains

5. Income from other sources.

INCOME FROM SALARY (TAXABLE INCOME UNDER SALARY)

1 Any salary due from an employer or a former employer to an assessee in the previous year whether paid or not.

2 Any salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer though not due or before it comes due to him.

HRA ALLOWANCE

(U/S 10(13A))

HRA exemption is not mandatory ….  that means not Applicable to all.

 5% HRA is mandatory in state of Maharashtra. In metro 50% of basic salary and in mon-metro 40% of basic salary is applicable.

In HRA more than 50% is treated as special allowance.

HRA can be fully taxable, fully non-taxable, partly taxable, partly non-taxable.

HRA allowance can be non-taxable , in case employee is stayed on rent within India and submit rent paid slips to employer along with form 12BB.

HRA exemption should be paid in case-

Rent location should be in India.

Present proper rent slips with address, bills etc.

Only rent amount is considerable , no other charges.

Employee should part of residence.

Rent slip should  be required monthly or quarterly.

Rent amount should be paid by employee. Rent should not be paid more than three months.

Every employee has to submit landlord’s PAN along with name in case rent amount is more than 8333 rupees.

HRA exemption cannot be in negative figure.

PROVIDENT FUND

A provident fund is a government-managed, mandatory retirement savings scheme used in India, Singapore, and other developing nations.  A worker gives a portion of his/her salary to the provident fund, and an employer should make a contribution on behalf of the employees.

What are the benefits of PF to employees?

Tax-saving :

Under Section 80C of the Indian Income Tax Act, an employee’s contribution towards their PF account is deemed eligible for tax exemption. Moreover, earnings generated through EPF scheme are exempted from taxes. Such exemption can be availed up to a limit of Rs.150000

How PF is calculated on salary?

– If you are a man, you must contribute 10% or 12% of your basic salary. – In case you are a new woman employee, it is 8% of your basic salary for the first 3 years. Thereafter, it becomes 10% or 12% of your basic salary. – Your employer has to contribute an amount equal to 10% or 12% of your basic salary towards EPF.

WHAT IS THE ELIGIBILITY CRITERIA FOR AN EMPLOYEE?

Any salaried employee who is a resident of India is liable to be a member of the employee provident fund scheme. The employee is liable for this scheme right from the first day of his/her joining to any job. Once the employee becomes a member, he/she is accountable for provident funds benefits along with the insurance and pension benefits.

It is mandatory for employees having a salary of Rs. 15,000 or more to be a member of this scheme although the employee can voluntarily apply for it at any wage. The employee contributes a minimum 12% of salary (can voluntarily contribute more).

WHAT IS THE ELIGIBILITY CRITERIA FOR THE EMPLOYER?

An employer is exempt from EPF scheme registration if the total employment of the organisation is less than 20 employees. An employer can also get an exemption if maximum employees voice their consent over the exemption although the latter case involves certain conditions and requires a lot of formalities. But in case, the total employees are more than 20 then it becomes mandatory for the employer to register for the EFF scheme.

 What is the current PF contribution rate?

Based on Basic salary: Generally, 12 per cent of Basic Salary goes into the PF account each month. So, if your monthly Basic Salary is Rs nearly 1.75 lakh ( just the basic salary and not your total monthly income), your monthly contribution is nearly Rs 20833, which is Rs 2.5 lakh in a year.

How is PF calculated?

The employee contributes 12 percent of his or her basic salary along with the Dearness Allowance every month to the EPF account. For example: If the basic salary is Rs. 15,000 per month, the employee contribution shall be 12 % of 15000, which comes to Rs 1800/-. This amount is the employee contribution.

ESIC –( EMPLOYEE STATE INSURANCE CORPORATION ACT 1948)

ESIC ACT was enacted by the government of india in 1948.The major objectives of this act was to provide certain benefits to employees in case of sickness, maternity and injury (during employment) and for providing other benefits in relation to main objects.

Those people whose gross monthly salary less than 21000 are eligible for ESIC.

In case person is disabled ESIC limit will be 25000.(Disability should be more than 40%.

ESIC provides full medical care to employees (spouse and dependents) in case of sickness,maternity,funeral expense, etc.

ESIC registration for new joiners within 10 days from the date of joining.

ESIC BENEFITS:

MATERNITY BENEFIT- either in block 70 days working she is eligible for maternity benefits.

ILLNESS BENEFITS- sickness benefit after completing 78 days. payable 70% of daily wages.

DEATH BENEFITS: start from date of joining 100% payable.

Vocational Benefits: During employment in case if there is any injury employee can claim 123 rupees per day.

ESIC always deducted in gross salary.

                          ESIC RATE

0.75% EMPLOYEE

3.25% EMPLOYER

PAYMENT MODE ONLINE,LAST DATE OF ESIC

CHALLAN DEPOSIT IS 15 OF FOLLOWING MONTH.

D A (DEARNESS ALLOWANCE)

What is Dearness Allowance

Dearness Allowance is paid by the government to its employees as well as a pensioner to offset the impact of inflation. The effective salary of government employees requires constant enhancement to help them cope up with the increasing prices. Despite several measures by the government to control the rate of inflation, only partial success has been achieved because the prices move according to the market. It, therefore, becomes essential for the government to shield its employees from the adverse effects of inflation. As the impact of inflation varies according to the location of the employee, dearness allowance is calculated accordingly. Thus, DA varies from employee to employee based on their presence in the urban, semi-urban or rural sector.

Calculation of Dearness Allowance

As DA is provided to employees to protect against the price rise in a particular financial year, it is calculated twice every year – in January and July. The formula to calculate the dearness allowance was changed in 2006 by the Government. Presently, DA is calculated as per the following formula: For the employees of Central Government % of DA = {(Average of the All-India Consumer Price Index (Base year -2001 =100) for the last 12 months -115.76)/115.76} x 100For Central Public Sector Employees % of DA = {(Average of the All-India Consumer Price Index (Base year -2001 =100) for the last 3 months -126.33)/126.33} x 100

Treatment of Dearness Allowance under Income Tax

As per the latest updates, DA is fully taxable for salaried employees. If the employee has been provided with an unfurnished rent-free accommodation, it becomes that part of the salary up to which it forms the retirement benefit salary of the employee, provided that all other pre-conditions are met. The Income Tax rules in India require the dearness allowance component to be mentioned separately in the returns that have been filed.

MATERNITY BENEFIT ACT

Maternity leaves applicable on a woman worker after 86 days. She should work at least 86 days for 6 months of maternity leaves.

Full wage salary is paid during this period.

Overtime is not allowed.Termination is not allowed.During maternity leave no other leave will be counted.

Work from home is allowed during maternity leave.

During maternity leave transfer is not allowed.

INCOME TAX

Income tax is a type of tax that central government charges on the income earned during a financial year by the individuals and businesses. Taxes are sources of revenue for the government. Government utilizes this revenue for developing infrastructure, providing healthcare, education, subsidy to the farmer/ agriculture sector and in other government welfare schemes. Taxes are mainly of two types, direct taxes and indirect form of taxes.  Tax levied directly on the income earned is called as direct tax,   for example Income tax is a direct tax. The tax calculation is based on the income slab rates applicable during that financial year.

What is the Existing / Old tax regime?

The old tax regime provides 3 slab rates for levy of income tax which are 5%, 20% tax rate and 30% for different brackets of income. The individuals have been given the option to continue with this Old tax regime and they can claim deductions of allowances like Leave Travel Concession (LTC), House Rent Allowance (HRA), and certain other allowances. Additionally, deductions for tax saving investments as per section 80C (LIC, PPF ,NPS etc) to 80U can be claimed. Standard deduction of Rs 50,000, deduction for interest paid on home loan.
Tax slab rates applicable for Individual taxpayer below 60 years for Old tax regime is as below:

Income RangeTax rateTax to be paid
Up to Rs.2,50,0000No tax
Between Rs 2.5 lakhs and Rs 5 lakhs5%5% of your taxable income
Between Rs 5 lakhs and Rs 10 lakhs20%Rs 12,500+ 20% of income above Rs 5 lakhs
Above 10 lakhs30%Rs 1,12,500+ 30% of income above Rs 10 lakhs

There are two other tax slabs for two other age groups: those who are 60 and older and those who are above 80.A word of note: People often misunderstand that if they earn let’s say Rs.12 lakhs, they will be paying a 30% tax on Rs.12 lakhs i.e Rs.3,60,000. That’s incorrect. A person earning 12 lakhs in the progressive tax system, will pay Rs.1,12,500+ Rs.60,000 = Rs. 1,72,500. Check out the income tax slabs for previous years and other age brackets.

Income Tax Slabs under new tax regime

From the FY 2020-21, a new tax regime is available for individuals and HUFs with lower tax rates and zero deductions/exemptions. Individuals and HUF have the option to choose the new regime or continue with the old regime.The new tax regime is optional and the choice should be made at the time of filing the ITR. If the old regime is continued than all the deductions/exemptions as available can be availed by the taxpayer. The income tax slabs under the new tax regime are:

New regime slab ratesExisting regime slab rates
Income from Rs 2.5 lakh to Rs 5 lakh5%Income from Rs 2.5 lakh to Rs 5 lakh5%
Income from Rs 5 lakh to Rs 7.5 lakh10%Income from Rs 5 lakh to Rs 10 lakh20%
Income from Rs 7.5 lakh to Rs 10 lakh15%Income above Rs 10 lakh30%
Income from Rs 10 lakh to Rs 12.5 lakh20%
Income from Rs 12.5 lakh to Rs 15 lakh25%
Income above Rs 15 lakh30%

Most of the deductions like deductions and exemptions are not allowed if the taxpayers opts for the New Tax regime. However he exemptions and deductions available under the new regime are:

  • Transport allowances in case of a specially-abled person.
  • Conveyance allowance received to meet the conveyance expenditure incurred as part of the employment.
  • Any compensation received to meet the cost of travel on tour or transfer.
  • Daily allowance received to meet the ordinary regular charges or expenditure you incur on account of absence from his regular place of duty.

GRATUITY

EXEMPTION U/S10(10(iii))

Gratuity is a retirement benefit payable at the time of retirement. Or leaving company at the age of 45 years. Or at death.

Eligibility- If a person complited 5 years in accompany.

Gratuity amount should be paid within 30 days of leaving.

Upto 2000000 lacs of gratuity amount is taxfree.

Calculation- last basic salary+ DA/26*15* no,of years of service.

LTA U/S10(5)

This allowance is meant for travelling expenses. Destination should be within India. This facility given 2 times within 4 years block.

Employee should have one of the traveller.

Foreign travel is not allowed.

LTA is non taxable upto 3 lacs in whole life.

Travelling mode –

By air-economy class.

By rail-AC first  class.

By taxi AC first class train rate.

SPECIAL ALLOWANCE

Special allowance is a fixed amount that is given to employees over and above the basic salary in order to meet certain requirements. There is a taxable allowance and an exempt allowance. There are different categories of special allowances.

CONCLUSION (THE ROLL OF PAYROLL MANAGEMENT)

 Broadly speaking, the payroll department pays employees accurately and on time. A wide range of duties encompass this process. Depending on the size of the business, the payroll department may have one or two employees or several employees. The primary mission of the payroll department is to ensure that all employee is being paid accurately and timely  with currect withholding and deduction ,and that withholding and deduction are remitted in a timely manner. The payroll department takes care of wage deduction, record keeping, and verifying reliability of pay data.

Thank You
Rupa Banerjee – Payroll Executive – Mumbai
Write to me at: rupabanerjee70@gmail.com

Categories
Increment Letters in PDF Payroll

Prepare Salary Increment PDF Letters using Mail Merge from Excel

Hi folks,

I will explain below one of the most common practice used in HR – human resource department e.g. Increment Letters Preparation, please follow the all steps. I will refer here following steps and topics:

  1. A Excel sheet with 5000 employee’s
  2. A word file which Increment letter template
  3. Mail merge Process
  4. MS word VBA code to generate PDF files from word
  5. MS word VBA code to hide zero value from increment letter for any allowance
  6. MS word VBA code to change authorize signatory’s scan signature as per manager name.
  7. Excel VBA Code to set individual password in employee’s separates increment letter ( Make sure this will work only if you are using office 32 bit only). Use info excel formula to get to know office version e.g.: =INFO(“OSVERSION”)

VBA Code for PDF generating from MS word file using mail merge

Sub Pdf_files_from_word()
'This code create by Ajit Yadav @99Excel.com
Dim fs, DocName, PDFPath, Folderpath, From, Till, Message
Folderpath = ActiveDocument.Path & "\" & "PDF Letters"
Set fs = CreateObject("Scripting.FileSystemObject")
If fs.FolderExists(Folderpath) = False Then
fs.createfolder (Folderpath)
Else
End If
        
From = 1    'Change From value
Till = 10    'Change Till value
 
Message = (Till - From) + 1
While From <= Till

    ActiveDocument.MailMerge.DataSource.ActiveRecord = From
    DocName = ActiveDocument.Fields(4).Result
    PDFPath = Folderpath & "\" & DocName & ".pdf"
    Call HideBlankCells
    Call Signature_Ins
    ActiveDocument.ExportAsFixedFormat OutputFileName:=PDFPath, ExportFormat:=wdExportFormatPDF, OpenAfterExport:=False, OptimizeFor:=wdExportOptimizeForPrint, Range:=wdExportAllDocument, Item:=wdExportDocumentContent, IncludeDocProps:=True
    Call UnHideBlankCells
From = From + 1
Wend
MsgBox "Done"
End Sub



Sub HideBlankCells()
Dim TableNo, ColumnNo, RowNo, I, GetValues
TableNo = 1
ColumnNo = 2
RowNo = ActiveDocument.Tables(TableNo).Rows.Count

For I = 2 To (RowNo - 2)
GetValues = CleanString(Trim(ActiveDocument.Tables(TableNo).Cell(I, ColumnNo).Range.Text))
ActiveDocument.Tables(TableNo).Cell(I, ColumnNo).Range.Select
If GetValues = 0 Or GetValues = "" Or GetValues = "0" Or GetValues = " " Or GetValues = "" Then
ActiveDocument.Tables(TableNo).Rows(I).Select
Selection.Rows.HeightRule = wdRowHeightExactly
Selection.Borders(wdBorderBottom).LineStyle = wdLineStyleNone
Selection.Rows.Height = CentimetersToPoints(0.001)
Else: End If
Next I

End Sub

Sub UnHideBlankCells()
Dim TableNo, ColumnNo, RowHigh, RowNo
TableNo = 1
ColumnNo = 1
RowHeightV = 0.8
RowNo = ActiveDocument.Tables(TableNo).Rows.Count

ActiveDocument.Tables(TableNo).Select
Selection.Cells.VerticalAlignment = wdCellAlignVerticalCenter
Selection.Rows.HeightRule = wdRowHeightExactly
Selection.Rows.Height = CentimetersToPoints(RowHeightV)

    For I = 2 To (RowNo - 1)
    ActiveDocument.Tables(TableNo).Rows(I).Select
    Selection.Rows.Borders(wdBorderBottom).LineStyle = wdLineStyleSingle
    Next I

End Sub


Function Signature_Ins()
If ActiveDocument.Fields(17).Result = "Ankita Joshi" Then
ActiveDocument.Shapes("Rectangle 1").Select
Selection.ShapeRange.Fill.UserPicture (ActiveDocument.Path & "\" & "Sign" & "\" & "Signature_Ankita Joshi.jpg")
ElseIf ActiveDocument.Fields(17).Result = "Vikas Maurya" Then
ActiveDocument.Shapes("Rectangle 1").Select
Selection.ShapeRange.Fill.UserPicture (ActiveDocument.Path & "\" & "Sign" & "\" & "Signature_Vikas Maurya.jpg")
Else
ActiveDocument.Shapes("Rectangle 1").Select
Selection.ShapeRange.Fill.UserPicture (ActiveDocument.Path & "\" & "Sign" & "\" & "Blank.jpg")
End If
End Function
Buy Pro Excel Sheet
WhatsApp: +91 9654421288
Categories
Payroll

Time to declare Tax regime and Investment Tax Planning for FY 2021-22

Dear All HR and Payroll Team,

It is time to get collect Tax regime old regime status and New Regime under section 115bac for tax computation for new financial Year 2021- 22.

Because we are in April and this is very first month for this financial Year so we need to send form 12BA investment declaration form to all employees to collect their this year tax planning details before calculating tax for April 2021.

Download ready to use Excel Both tax regime tax calculation and compare Sheet.

Download Excel to compare

:::Posted from Mobile:::

Categories
Payroll

Atmanirbhar Bharat Rozgar Yojana: Contribution of Government to Provident Fund Members.

On November 12th 2020, Union Finance Minister Nirmala Sitharaman announced another set of stimulus measures under the Atmanirbhar Bharat Abhiyaan 3.0 scheme to incentivize jobs creation in the country. The benefits of this scheme will be given to all the Establishments registered with the Employee Provident Fund Organization (EPFO) and which employ new employees or give employment to those who lost jobs between March 1 2020 and September 30 2020 due to covid-19.

Who are eligible to obtain the benefit?
This scheme is a contribution to the PF account of employees who have lost jobs during the period from March 1st 2020 to September 30th 2020 and subsidy to the establishment.
Under this scheme government will contribute provident fund (employers and employees share at the rate of 12 per cent of wages) for two years to organizations with employee strength less than 1000.
For those companies which are having the strength more than 1,000 employees, the government will provide only employee’s contribution at the rate of 12 per cent of wages.
The benefit will be provided to only those employees with wages less than ₹ 15,000 per month. The subsidy in the form of PF contributions will be directly credited into the Aadhaar-seeded EPF account (UAN) of the employee.

Points to be consider for getting the PF subsidy
Establishments with less than 50 employees must recruit at least two new employees and organizations with more than 50 employees must employ at least five new employees.
The month of September will be considered as the base for the scheme. For organizations with up to 1,000 employees who earn up to Rs 15,000 per month and are registered under EPFO, the 12% contribution of the employees and 12% from the employer – amounting to a total 24% will be borne entirely by the central government.

When the scheme will be become effective?
The scheme will be in effect from 1 October 2020 and 30 June 2021, meaning new employment has to take place between this period.

Categories
Minimum Wage Payroll

Revised Minimum Wages of Delhi w.e.f 1st April 2020 and 1st October 2020.

The Delhi government has enhanced monthly dearness allowance for its unskilled, semi-skilled, skilled and other category workers.

The revised minimum wages, including the dearness allowance (DA), will be applicable to unskilled, semi-skilled and skilled categories in all scheduled employments, from April 1st 2020 and October 1, 2020 respectively.

Consider below the chart displaying the amended wage rates of all the categories of workers.

CategoryRate Vide Notification dated 22/09/2019D.A.(PM) W.e.f April 1st 2020Total per month W.e.f April 1st 2020Total per Day W.e.f April 1st 2020D.A.(PM) W.e.f October  1st 2020Total per month W.e.f October 1st 2020Total per Day W.e.f October 1st 2020
Unskilled14,842.00₹ 468.00 15,310.00 589.00 182.00 15,492.00 596.00
Semi-skilled 16,341.00 520.00 16,861.00 649.00 208.00 17,069.00 657.00
Skilled 17,991.00 572.00 18,563.00 714.00 234.00 18,797.00 723.00
Clerical and supervisory staff – Non Matriculate 16,341.00 520.00 16,861.00 649.00 208.00 17,069.00 657.00
Clerical and supervisory staff – Matriculate but not Graduate 17,991.00 572.00 18,563.00 714.00 234.00 18,797.00 723.00
Clerical and supervisory staff – Graduate and above 19,572.00 624.00 20,196.00 777.00 234.00 20,430.00 786.00

Below is the definition of category of workers for classification of skill and wages.

(A) Highly skilled-A highly skilled worker is one who is capable of working efficiently and supervises efficiently the work of skilled employees.
(B) Skilled- Skilled employee is one who is capable of working independently and efficiently and turning out accurate working. He must be capable of reading and working on simple drawing circuits and process, if necessary. (ELECTRICIAN, MECHANIC, TAILORS, COOKS Comes in skilled category).
(C) Semi-skilled– A semiskilled worker is one who does work generally of defined routine nature wherein the major requirement is not so much of the judgment, skill and but for proper discharge of duties assigned to him or relatively narrow job and where important decisions made by others.( GATEKEEPER(CINEMA),ASST. OPERATOR, ASST ELECTRICIAN, BOOKBINDER,WAITER OR BEARER, MALI WITH TECHNICAL EXPERIENCE comes in semi skilled category).
(D) Un-skilled- Un-skilled employee is one who possesses no special training and whose work involves the performance of the simple duties which require the exercise of little or no independent judgment or previous experience although a familiarity with the occupational environment is necessary. (UNSKILLED: PEON, CHOWKIDAR, DURBAN, WATCHMAN, CLEANER, SWEEPER, LOADER, HELPER, MALI comes in unskilled category.)

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Categories
Payroll Provident Fund (PF)

PROVIDENT FUND RULE’S FOR INTERNATIONAL WORKER’S

DEFINITION AND COVERAGE OF INTERNATIONAL WORKER UNDER PROVIDENT FUND

An International Worker (IW) is any employee who is a foreign national working in India under an employer registered with the EPFO or an Indian employee who is working in a foreign country with which India has a Social Security Agreement (SSA).  Every foreign worker employed with an establishment to whom the EPF applies must become a member of the provident fund (PF) from the first date of his/her employment. There is no minimum period of stay in India for activation of PF compliance. Hence, in relation to individuals working in India in establishments to which the EPF Act applies, an employee other than an Indian employee, holding other than an Indian passport, can be treated as an International Worker. One would also need to examine whether such an individual comes from a country with which India has signed a SSA, and if so, whether contributions need to be made in India or in the home country of this individual, based on the terms of the SSA.

If an employee is classified as an International Worker and provident fund contributions are payable in India (either because India does not have an SSA with the country from which such individual comes, or because the SSA benefits are not triggered based on various factors), the Indian employer will be required to make contributions under the EPF Act on the entire global income of such individuals (without any upper limit).

PF CONTRIBUTION RATE FOR INTERNATIONAL WORKERS

The PF contribution rate for foreign workers registered with EPF (or IWs) is 12 percent. The PF rate is calculated on full salary of the IW irrespective of whether the salary is remunerated in India or outside India, split payroll, or multiple country sources.

The major difference between regular Indian workers, and IWs, is that for Indian employees, companies are entitled to limit their provident fund contribution to 12% of INR 15,000 (i.e. INR 1,800 per month)(the upper limit), even if the ‘monthly pay’ (defined to mean basic wages, dearness allowance and retaining allowance) of the employee exceeds INR 15,000.  In case of IW’s there is no upper limit.

Therefore, in the event of any alleged non-compliance with the obligation to make PF contributions for IWs, organizations can face significantly greater liability to make hefty payment on pending contributions (along with interest and penalties).

Exemptions

IWs are exempt from contribution towards PF only if their home country has a social security agreement (SSA) or economic-bi-lateral treaty with India

ELIGIBLE SERVICE FOR INTERNATIONAL WORKERS UNDER THE EMPLOYEES’ PENSION SCHEME, 1952

By a notification dated 05 October 2012, the Ministry of Labour of Employment has introduced sub-paragraph 4A to paragraph 43-A of the Employees’ Pension Scheme, 1952 (EPS) which deals specifically with international workers. Under the EPS, an employee is eligible for pension upon his retirement, if the employee has rendered the minimum eligible service of 10 years.

By virtue of this notification, the Ministry has clarified that in respect of an international worker from a country with which India has executed an SSA, eligibility for pension is determined on the total number of years of service rendered by the international worker under the social security programme of his home country and the number of years of service rendered in India in an establishment covered under the EPS. For example, if an employee has been employed in his home country for a period of 20 years and in India for a period of 7 years, the employee’s eligible service in India would be considered as 27 years and he would be eligible for pension.

However, it is relevant to note that the calculation of pension is made only on the number of years during which contributions were made under the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (EPF Act). In the example above, the international worker’s pension would be calculated on the 7 years during which contributions were made on his behalf under the EPF Act.

WITHDRAWAL RULES UNDER EPF

An international worker may withdraw the accumulated balance in the EPF account in one of the following situations:

1. at the time of retirements, that is, on or after 58 years of age.

2. in case of retirement due to permanent and total mental or physical incapacity to work.

3. in case of serious illness such as cancer, leprosy, or tuberculosis; or,

4. on completion of Indian employment, if the IW’s home country has an SSA with India.

The facility to receive PF refund on the date of completion of Indian employment is not available for IWs who are not covered under SSA.

WITHDRAWAL OF FUNDS UNDER EPS

The EPS regulations do not recognize the employer’s contribution to the pension scheme. Since only employer’s contributions are allocated to the EPF, the EPS does not entitle IWs to pension benefits when they leave India, regardless of accrued employer contributions.

The pension withdrawal is only available to employees who are covered under an SSA that has come to effect, and to employees who have not completed the eligible service of 10 years even after including the totalization of service under the respective SSAs.

Categories
monthly Compliance Calendar Payroll

Statutory Compliance’s Dues Date Calendar for October 2020

Hi Folks,

Happy to sharing the statutory compliance calendar for the month of October 2020. Consider below Statutory compliance’s dues date calendar issued by Payrollpedia.org for October 2020.

What is Statutory Compliance?

For an organization to function smoothly, it needs to be streamlined, organized and must have proper rules and regulations in place. These regulations extend to every aspect, including how the organization interacts with its employees. This is referred to as statutory compliance. In human resources, statutory compliance relates to the legal framework within which companies must operate in the treatment of their employees.

Mark the important dates on your calendar so that you will never miss out the important dates for completing the compliance’s of October 2020. 

Date (by when)Applicable ActDetails of Compliance
07-Oct-20TAX DEPOSITMonthly Deposit Tax Contribution
15-Oct-20ESICMonthly Deposit Esic Contribution
15-Oct-20PROVIDENT FUNDMonthly Deposit Pf Contribution
30-Oct-20EMPLOYMENT EXCHANGEQuarterly Return for Quarter ending 30th SEP
31-Oct-20TDS SALARY II QTR RETURNQuarterly Return for TDS Salary II QTR(24Q)
20-Oct-20 PROFESSIONAL TAXKarnataka (Bangalore) [Monthly]
10-Oct-20 PROFESSIONAL TAXAndhra Pradesh (Hyderabad) [Monthly]
21-Oct-20 PROFESSIONAL TAXWest Bengal (Kolkata) [Monthly]
31-Oct-20 PROFESSIONAL TAXMaharashtra (Mumbai) [Monthly]
15-Oct-20 PROFESSIONAL TAXGujarat (Ahmedabad) [Monthly]
31-Oct-20 PROFESSIONAL TAXOrissa (Monthly)
10-Oct-20 PROFESSIONAL TAXMadhya Pradesh (Indore) (Monthly Salary)
31-Oct-20 PROFESSIONAL TAXGuwahati (Assam) (Monthly)
31-Oct-20 PROFESSIONAL TAXPONDICHERRY (Half-Yearly)
31-Oct-20LWFHaryana
15-Oct-20LWFPunjab
15-Oct-20LWFChandigarh

Download the compliance chart for month of October 2020. For getting paid the consultation on these on compliance’s you can reach us through

Email: cheshtas92@gmail.com &

Call/WhatsApp us : +91 8700694790

Download the calendar

Categories
Min Wages Minimum Wage Payroll

Download Minimum Wages Excel sheet for all states – Month Wise

Looking for monthly minimum wages Excel sheet for All States? We have ready to use monthly minimum wages Excel sheet for PAN India (All States) from 2016 on-wards.

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Minimum wages can also be one element of a policy to overcome poverty and reduce inequality, including those between men and women, by promoting the right to equal remuneration for work of equal value.

Consequences of not paying the Minimum Wages as per the rates prescribed by the state government.

Under-payment and non-payment of Minimum Wage is deemed as an offense under the Central Act. The penalty may range from upto 5 years imprisonment and a fine of Rs. 10000/- (under Section 22 of the Act).

Download minimum wages in excel for Rs. 1000 each for your reference and guide.

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Categories
Payroll

Company-Leased Accommodation (CLA) or Rent -Free Accommodation (RFA)

Many Indian and Multinational companies provides various kinds of employee benefits , these benefits are over and above salaries which includes financial and non-financial perks such as rent free accommodation or company accommodation ,club membership ,loan perk and hotel perk etc. The current employment trend has expanded the span of job opportunities as the result of which employees often travel to new places in search of jobs. Nesting in a new place requires them to look for rental accommodations. Sometimes companies provide company leased apartments as a part of their compensation package. However, with tax regulations constantly changes, it is not clear whether these perks are tax exempted or not.

In this blog we will be explaining the Company Leased Accommodation (CLA) or RFA ,How to calculate CLA and difference between CLA and HRA.

Company-leased accommodation(CLA) or Rent Free Accommodation(RFA) is considered a perquisite in the hands of the employee, and its value is determined as per the income tax rules. In case of a company lease accommodation, the amount of rent paid by the employer is deducted from salary and hence the taxable income of the employee reduces to that extent. The employer enters into the lease agreement with the landlord, pays the rental deposit and pays the monthly rent directly to the landlord. The house may be a ‘ready to move in’ accommodation, per-identified by the company or it could be a house of the employee’s choice. Opting for company-leased accommodation helps the employee settle down faster in a new city and the company is also at an advantage because the employee can concentrate on the new job without the added stress of arranging accommodation. For tax purposes, the accommodation provided by the company is treated as a ‘perquisite’ in the hands of employee and is considered to be a part of taxable salary.

How to calculate CLA?

The perquisite value of such accommodation is added to in the taxable income of employee, Perquisite value is the lower of:

  1. 15% of taxable salary* excluding the value of perquisites;
  2. Actual rent paid by the company.

‘Salary’ here includes the total salary, but excludes the allowances exempted from tax, employer’s contribution to the provident fund, any medical benefits paid by the employer and value of other perquisites like electricity bills, and car or club expenses provided by the employer. If the rent paid by the employer is more than 15% of the salary, the employee stands to gain because a part of the rent paid by the employer goes tax free.

For example: The actual rent paid by the company is Rs. 10,000, and the gross salary is Rs. 2,00,000. Please consider below the calculation of CLA  

Step-1 15% of Gross salary i.e. Rs. 2,00,000 which comes to Rs. 30,000

Step-2 Actual rent paid by company is Rs. 10,000.

Minimum of above two steps is CLA ,so the answer is Rs. 10,000

It is important to note that where the city population is less than 10 lakh then percentage for calculation will be 7% of gross salary, if the population is more than 10 lakh but less than 15 lakh then percentage for calculation will be 10% of gross salary and lastly if the population is more than 15 lakh then percentage for calculation will be 15% of gross salary.

What is difference between HRA & CLA?

HRA is an allowance which is added in salary and is tax exempt to a certain extent (as per IT rules) whereas CLA is treated as a perquisite (a benefit which is given by company to employee) and is taxable in the hands of the employee. i.e. an employee are liable to pay income tax on the perquisite value of the house.

HRA is a component of salary package which the company issues on monthly basis whereas CLA is not part of employee’s monthly take home. Normally, a company gives the employee a choice to decide which way he wants to go.

If an employee opts for HRA, he needs to take care of his accommodation, rent and other things. In case of CLA, the company provides the accommodation and employee needs not to worry about it.

Thanks Cheshta Sharma