4 STATUTORY DEDUCTIONS TO CONSIDER WHILE RUNNING PAYROLL

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FASTCOLLAB

• 4 STATUTORY DEDUCTIONS TO CONSIDER WHILE RUNNING
  PAYROLL

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• It is a general guideline from Government of
  India that if a company crosses the employee
  strength of 20 numbers, it is time the employers
  should bring some statutory deductions in
  picture, like Employee Provident Fund (EPF),
  Professional Tax (PT), Employees State Insurance
  (ESI). However Income Tax (IT) deductions (also
  known as Tax Deducted at Source (TDS) is
  applicable even with a single employee.
• 1. Employees Provident Fund (EPF)
• EPF came into existence in 11th November 1952.
  EPF has traditionally been the only device for
  most Indians, particularly for the salaried
  class, so that they can save their retirement
  corpus. The government has now offered to pay
  interest on faulty accounts, almost 60 of the
  total number.

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• 2. Professional Tax (PT)
• Professional Tax is the tax
  duty on professions trades in India. It is the
  state-level tax has to pay imperatively by
  every member employed in private organisations.
• 3. Employees State Insurance (ESI)
• ESI is contributed from both the sides Employer
  as well as Employee. It is calculated on the
  basis of Total salary per month, and the maximum
  ceiling is Rs.15000 per Month.
• 4. Income Tax (IT) deduction or TDS
• Under the Section 192, the employer is needed to
  deduct TDS while making the payment
  month-on-month salary for any financial year to
  the employees. The tax form or forms applied to
  file Income Tax with the Internal Revenue Service
  (IRS). 

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