Hi,
This is for a start-up with 10 employees in Telangana. Kindly guide on the necessary components one should have in their pay slip.
(i) What % of basic should be HRA
(ii) Is providing Travelling allowance mandatory? If yes, what should it be the percentage of basic?
(iii) When is it mandatory to deduct professional Tax?
(iv) When When is it mandatory to deduct PF?
(v) When is it mandatory to deduct ESI?
(vi) When is it mandatory to deduct TDS?
From India, Hyderabad
This is for a start-up with 10 employees in Telangana. Kindly guide on the necessary components one should have in their pay slip.
(i) What % of basic should be HRA
(ii) Is providing Travelling allowance mandatory? If yes, what should it be the percentage of basic?
(iii) When is it mandatory to deduct professional Tax?
(iv) When When is it mandatory to deduct PF?
(v) When is it mandatory to deduct ESI?
(vi) When is it mandatory to deduct TDS?
From India, Hyderabad
Your queries are answered below at seriatim:
1. Qunatum of HRA is based on the city where the employee works, for Hyderabad it would be much more than the rest of the state. So, find out the HRA category for your city from other industries/offices and decide accordingly.
2. Travelling allowance is a perquisite, not a mandatory one, created for the purpose of spreading the compensation item. There are two types of Travelling Allowance, one is applicable to all employees either as a percentage of basic pay or as a fixed amount, and the other is an allowance provided to defray expenses for travel for official purposes, it would be a rate of TA (like Rs. 10/15 for every KM traveled). The latter is essentially a reimbursement of the expenses.
3 to 6: These are statutory deductions and have to be made from the first salary onwards. Before that complete the formalities required for the enrolment. It is better not to take it easy, better ensure full compliance to avoid later complications.
From India, Mumbai
15341. Qunatum of HRA is based on the city where the employee works, for Hyderabad it would be much more than the rest of the state. So, find out the HRA category for your city from other industries/offices and decide accordingly.
2. Travelling allowance is a perquisite, not a mandatory one, created for the purpose of spreading the compensation item. There are two types of Travelling Allowance, one is applicable to all employees either as a percentage of basic pay or as a fixed amount, and the other is an allowance provided to defray expenses for travel for official purposes, it would be a rate of TA (like Rs. 10/15 for every KM traveled). The latter is essentially a reimbursement of the expenses.
3 to 6: These are statutory deductions and have to be made from the first salary onwards. Before that complete the formalities required for the enrolment. It is better not to take it easy, better ensure full compliance to avoid later complications.
From India, Mumbai
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