Salary Components

A salary comprises of several different earning, deduction and reimbursement components. In this section of settings, you can:

Add Earning

Any money that an employee receives as income is termed as an earning. Some of the common earning components are Basic Pay, House Rent Allowance (HRA), and Dearness Allowance. You can add an earning by following these steps.

Add Earning

Add Deduction

Deduction is money that’s taken from your employees’ monthly pay. There are two types of deductions, pre-tax and post-tax.

Pre-tax

A pre-tax deduction is money taken out of the employee’s pay before income tax is calculated. As a result, they reduce the employee’s net taxable income and thereby reduce income tax. An example is deductions made towards schemes like National Pension Scheme (NPS) or Voluntary Provident Fund (VPF).

Disclaimer: Zoho Payroll does not deposit the deductions to the vendors on your behalf. You would have to deposit the deductions by yourself.

Add Pre-tax Deduction

You can associate this deduction to your employees from the employee details page or during pay runs.

Post-tax

A post-tax deduction is money taken out of your employees’ pay after income tax has been calculated. This does not affect the net taxable income of the employee.Purchases made in the company grocery store or food court are examples of post-tax deductions.

Note: Post-tax deductions are one-time. They won’t recur in subsequent pay runs

Add Post-tax Deduction

You can associate this deduction to your employees from the employee details page or during pay runs.

Add Correction

Once you’ve associated recurring earnings like Basic, HRA, DA etc. to employees, you won’t be able to edit them. In such cases, you can create a one-time correction component to make corrections to an earning component.

Add Correction

You can now apply this correction component to specific employees while processing your monthly pay runs.

Edit Component

You can edit salary components, provided it wasn’t involved in any pay runs, by following these steps:

Edit Earning
TOP