Case Study 1:
Micro Power Source Private Limited has started business during the year and hired 3 employees with following salary and other details;
Note:
- Assume Company has taken PT, PF and ESI registration. PF limited to Rs.1,800/-
- CTC Structure (% of Gross Salary): Basic-30%; DA-10%; HRA-20%; Other Allowances-40%.
- Employee codes format: FINC101
- CFO is eligible for the variable pay at 10% on CTC upon achieving target and 15% on above target.
- TDS deductible for Shreya Hegde is Rs.3380 per month and for others it’s Zero. Also, PT of Rs.200 p.m. is applicable for Shreya only as her salary is more than Rs.25,000 where PT in the state of karnataka is applicable if the gross salary is more than Rs.25,000.
- Company also provides medical insurance to all employees as per the following table:
Steps to Issue Payslip:
Step 1:
Prepare CTC calculation for all employees
Step 2:
Prepare CTC of each employees in the CTC structure format provided without leave details
Step 3:
Prepare Salary Statement with leave details
Step 4:
Prepare Payslip for all employees in the given format
Step 1: CTC calculation for all employees:
Gross:
The structure breakup has been done as per the question.
Deductions:
As per the question, PT is applicable for Shreya only. Further, PF has been calculated @12% of (Basic + DA), subject to maximum of Rs.1800/-. Further, ESI has been calculated @0.75% of Gross and is applicable for Kiran and Raghu only, as their salaries are less than Rs. 21,000/-
Employer Contribution:
ESI is calculated @3.25% of the Gross Salary.
Step 2: CTC Structure:
CTC Structure of Shreya Hegde
CTC Structure of Kiran Bhat
CTC Structure of Raghu N
Note:
- As per note 3 in question only CFO is eligible for VPP
- Hospitalization & Personal Accident Insurance has been filled as per the salary range given in the question.
Step 3: Salary statement for the month of August:
Leaves and revised Gross Salary:
Deductions:
Employer Contribution:
Step 4: Payslips for the month of August:
