Payslip Format India – Earnings, Deductions & Leaves
A payslip also called a salary slip is a document issued by an employer to its employees. A Payslip contains a detailed breakdown of monetary components of the employee’s salary, all earnings and deductions for a given period. This period is generally a monthly cycle. A company is legally bound to issue a Payslip to its employees.
A Payslip can either be printed hard copy or e-mailed to the employees (mostly preferred in recent times). The employees can then download them as the need arises.
Components of a Payslip
It is made up of the monetary components in a salary. It includes:
- Basic pay
- Dearness Allowance
- House Rent Allowance
- Medical Allowance
- Conveyance Allowance
- Other Allowances provided by the organization
As reduced by,
- Provident fund contribution
- Employee State Insurance contribution
- National Pension Scheme contribution
- Tax Deducted at Source
- Professional Tax
- Other deductions made from the salary
Importance of Payslips
- Helps the employee understand the breakup of salary
- Informs the employee of the monetary benefits derived from the employment
- It shows you the number of days worked and the days considered as Loss of Pay(LOP) to cross-check with the salary received. Payslip helps you sort out discrepancies if any.
- Payslip acts as legal proof of income for an employee.
- It also provides proof of employment.
- The employees are aware of their contributions towards social securities such as Provident fund, Employee State Insurance, wherever applicable.
- It is a ready reckoner for your Universal Account Number (UAN) and Permanent Retirement Account Number (PRAN) (OfficeAnywhere Payroll lets you enable this option)
- It shows the portion of employee’s contribution towards Income Tax (in the form of Tax Deducted at Source- TDS) and Professional Tax, wherever applicable.
- It acts as proof of the document when applying for loans and mortgages.
- Application for credit cards require 2-3 month’s payslips.
- It also helps in negotiating for a salary hike when applying for a new job opportunity.
- Considering all the above, it aids you plan your finances of investments and expenditures for the times to come.