Salary Slip and its importance
We live in an era where money makes life simpler. Employees work hard all round the clock to fulfill their monetary needs, making their life simple. And owing to the hard work employees do and also as a right to know, every employee is entitled to a salary slip. Even though most of the salaried people do get a salary slip which contains employee salary details in excel format, many employers don’t issue one to their employees. And in such a case, all employees need to request every month’s Salary Slip from their employer as it is a very crucial document and contains data regarding various aspects of employee’s employment. Here’s everything about Salary Slips, every employee should know:
What is a Salary Pay Slip?
A Salary Pay Slip is a documented bifurcation of an employee’s salary that every employer is legally bound to issue to each employee, irrespective of the amount of salary received by the employee. A Salary Pay Slip contains income details like basic salary, various allowances, and more along with the deductions made like TDS, PF, and more. Here’s how an employee salary details format in excel looks like:
Components of a Salary Slip
An employee’s Salary Slip is divided into two parts. One which displays all income and the other which displays all deduction details. To get an even clearer picture, here’s a brief insight:
The income section of a salary payslip contains all that the employee is earing for his hard work which includes various allowances the employee is receiving from the organization. Income Section is further divided as follows:
- Basic Salary
- Dearness allowance(DA),
- House Rent Allowance(HRA),
- Conveyance allowance,
- Special allowance,
- Medical allowance,
- Leave travel allowance and
- Other Allowances
- deductions like income tax, provident fund, professional tax.
Now coming onto the deduction section, every employee has to contribute a part of his salary towards the development of the country by paying taxes. Moreover, the government has a few policies in place that work towards ensuring a happy retirement for employees for which deductions from the current salary are made. In most cases, there are 3 deductions:
- TDS(Tax Deducted at Source)
- Professional Tax
- PF(Provident Fund/Pension Fund)
Importance of a Salary Pay Slip:
Income Tax: Filing Income Tax is
Required when searching for a new job: When searching for a new job, most of the HR recruiters ask for a salary slip from the previous employer as it is an official document that can’t be faked since many employees lie about their salaries too. Therefore, every employee should make sure they have monthly payslips issued to them by their respective employers.
Get Loans, Credit Cards: Anyone who has applied for either a loan or credit card, lender’s first requirement is a salary slip. A salary slip assures the lender that the individual is working and based on their salary, is capable enough to pay off loans and credit card bills.
Proof of Employment: A salary slip serves as proof of employment everywhere, all around the world. So next time anyone questions your employment, show them their salary slip!!
Calculate Savings: It isn’t manually easy to keep a record of salary deductions which end as savings of the individual. However, a payslip contains valuable information like UAN No. and monthly PF deductions which make it easy, to sum up, the total savings of an employee.
Role of HRMS in managing Employee Salary Details
The world around us is getting smarter every day, owing to the rapid infusion of technology in every field. And unsurprisingly Human Resource Management is no exception to this advancement. Now more than ever, employers need to embrace an automated HRMS which is a boon for both employers and employees.
With an HRMS, accessing one’s employee salary details format in excel is no more a burden as all it needs is just a click and a few seconds of your valuable time.