Salary Cut! Let us understand where deduction takes place from salary and what we should keep in mind.
Salary Cut! Salaried class person is eagerly waiting for his salary at the end of the month. It often happens that as soon as the message of credit of your salary in the bank account comes, you come to know that the salary has come down. At the same time, you start looking for the answer to the question, where is the salary deducted. Actually, there are many things about deduction in salary, which we should keep in mind. Tax expert CA Manish Gupta says that every employee should check his salary slip carefully every month. In this, it is important to see which one is being deducted from the salary. Employee should check that only that money is being deducted which has been decided to be deducted. There is no wrong deduction happening somewhere. Let’s understand from CA Gupta where deduction happens from salary and what we should keep in mind.
Provident Fund (PF)
Provident Fund (PF) deduction is the most important deduction for employees. It is 8.33% of the basic salary of the employee. The employee should calculate his PF and see that the PF has been deducted as per the rules and also check that the UAN number of your PF is correctly entered in the salary slip. The employee should also find out whether his employer is registered under the PF Act or not. If the institution is not registered, then the deduction of PF is illegal and the benefit of deduction made from the salary of the employee is not going to be available to him.
It should also be known that apart from deducting the PF of the employee, he is submitting both by adding his own contribution and filing monthly and annual returns of PF. If an employee has authorized to give any voluntary contribution or donation, then that money can also be deducted from the employee’s salary. Its details must be given in the salary slip. It has been seen many times that employees request their employer that their PF should be deducted more so that more money is deposited in their PF. If this is the case, then the employee’s contribution will be getting cut more, then he must check in his salary slip.
ESI
The second major deduction in salary is that of ESI. In this deduction, 1.75% of the total salary is deducted and the employer’s contribution should be deposited in the Employees’ State Insurance Department through challan. The employee should also check the ESI number in his salary slip and confirm with his account number. The employee should also find out whether his employer is registered under the ESI Act or not. Deduction of ESI is illegal if the institution is not registered.
TDS i.e. deduction of income tax on salary
Employees whose salary income exceeds the taxation limit of Income Tax Act, then the employer ie the company is required to deduct TDS from the salary of its employees under section 192 of the Income Tax Act. If the employee wants, then its calculation sheet can be obtained from his company. The company should make such effort that TDS falls equally on its employees. At the same time, it is the responsibility of the employee to go to the taxation department of his employer and check that how much TDS is being deducted for the whole year, then how much should be deducted every month.
Also, the TDS deducted every month should be matched with the calculation sheet received from the company. In this, it should also be seen whether the Permanent Account Number (PAN) is correctly entered in the salary slip or not. If the employee wants, then check the calculation of income tax himself and see whether the income tax is deducted properly or not. If employees want, they can deduct more TDS by giving information about their other income to the company. In such a situation, the employee should reconcile such more deducted GDS with his salary slip.
Loan repayment installment and interest
If the employee has taken any kind of loan from his company for personal, education, marriage, car or house etc., then the monthly installment of that loan i.e. EMI and interest (if any) will be paid on the basis of his loan agreement. Money can be deducted from your salary. This should be mentioned in the salary slip of the employee and the amount deducted by the employee should be known so that he can tally it with the statement of his loan account and check the status of his loan.
Impress
If an employee takes any amount as an impression for doing the official work of his company or to keep it in reserve for work and after the work is done, the remaining money has not been returned according to the company policy and the account has not been equalized and the money If payable, the remaining amount can be deducted from the salary. Full details of this should be given in the salary slip.
salary advance
If there is a sudden need of money, if an employee takes advance from his company, then at that time a rule is decided between the company and the employee that how and how much will be its deduction. The employee should be aware of this as it will be deducted from the advance salary. For this, you need to look at the salary slip thoroughly.
reason for leave or late arrival
Many times, if you do not reach work for taking more leave than the rule or if you arrive late, the salary can be deducted for that number of days based on the HR policy of the company and it will be mentioned in the salary slip.
reduction in salary
If an employee is demoted and salary pay has been reduced or lock down or at present, if the salary has been reduced due to Kovid epidemic, then according to which the salary has been deducted, it is also mentioned in the salary slip. will be told in
Penalty
If an employee has caused any loss and any penalty has been imposed on him or if any damage has to be recovered from him, then in this case deduction can be done from the salary as per the policy of the company. Its details should be in the salary.
professional tax
In some states, it has been decided to deduct professional tax of every employee who is eligible according to that law. In such a situation, there is a need to check whether the professional tax deduction is as per the rules or not. Also, the company can deduct that money from the employee’s salary and it must be mentioned in the salary slip.
