Payroll Processing
Salary computation, statutory deductions, payment registers and Form 16 issuance.
Monthly cycle, typically completed within 3–5 working days of receiving attendance data
Payroll is a monthly deadline that cannot slip, and it carries several statutory obligations at once — income tax deducted at source on salaries, and, where applicable, provident fund and employees' state insurance.
We run payroll for employers who would rather not maintain the process in-house, and handle the deposits and returns that follow from it.
Computing salary TDS correctly
Tax on salary is deducted across the year on an estimate of the employee's annual income, adjusted as declarations and proofs come in. Under-deducting early in the year produces a large deduction in the final months, which employees notice; over-deducting ties up their money until they file a return.
We collect declarations at the start of the year, verify proofs before the final quarter, and adjust the monthly deduction as the position changes.
Regime choice affects the deduction
Employees may fall under the old or the new tax regime, and the deductions available differ substantially between them. The choice affects what is deducted from salary each month, so it needs to be captured at the start of the year.
We provide a comparison for employees who ask, on the understanding that the choice is theirs and depends on their full circumstances, not only on salary.
Who needs this
- Employers with salaried staff on the payroll
- Businesses that deduct tax at source on salaries
- Employers registered for provident fund or employees' state insurance
- Employers who need Form 16 issued at the end of the year
Eligibility and conditions
- An employee list with salary structures
- A TAN for depositing tax deducted
- Attendance or leave data for each month
What this covers
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Monthly computation
Salary, deductions and net pay computed for each employee.
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Payment register
A register ready for bank upload or payment.
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TDS deposit
Tax deducted computed and deposited within the due date.
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Quarterly returns
TDS returns on salaries filed each quarter.
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Form 16
Issued to employees after the year end.
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Payslips
Prepared for distribution to employees.
How the process works
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Set up
Employee master, salary structures and declarations captured.
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Monthly data
Attendance, leave and any changes received.
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Compute
Salary and deductions calculated and shared for approval.
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Pay and deposit
Payment register issued and TDS deposited.
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Returns and Form 16
Quarterly returns filed and Form 16 issued annually.
Documents required
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Employee list
With dates of joining and salary structures.
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Investment declarations
From employees, at the start of the year.
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Investment proofs
Before the final quarter, for verification.
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Attendance and leave data
For each month.
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TAN details
For depositing tax deducted.
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PF and ESI registration
Where applicable.
The list above is indicative. Additional documents may be required depending on your case and the current departmental requirements.
Frequently asked questions
On which payments do I have to deduct TDS?
Tax deduction at source applies to a range of payments — salaries, contractor payments, professional fees, rent, commission and interest among them — each with its own rate and threshold.
Failing to deduct can result in part of the expense being disallowed when computing taxable income, which usually costs considerably more than the deduction itself. We review your payment types and tell you which attract deduction and at what rate.
Need payroll handled?
Tell us your headcount and what you currently do in-house, and we will set out how the monthly cycle would work.