Class 5. payroll processing 1 v7.0
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The document discusses compensation and benefits (C&B) programs, including definitions, objectives, components, and examples of cost to company (CTC) structures. Specifically: - C&B programs provide monetary (compensation) and non-monetary (benefits) returns to employees in exchange for their work. The objectives are to attract, retain and motivate staff. - Compensation includes salary, overtime, incentives, bonuses and commissions. Benefits include allowances, insurance, transportation, meals and training. - CTC is the total salary package that includes all employer expenses like basic pay, allowances, statutory contributions and exemptions. Two examples of designing CTC structures are provided.
![. . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards
Payroll Processing
Components Features
Basic Preferably (30 – 60) % of CTC in most cases; fully taxable
House Rent Allowance 40% of Basic in Non Metro Location; 50% of Basic in Metro
Location; partially taxable
Leave Travel Allowance LTA is exempted from tax twice in a 4 years block
Conveyance Allowance Earlier [INR. 19,200 per Annum is exempted from Tax]; Now [CA
and MA cumulatively 40,000 per Annum is exempted from Tax]
Medical Allowance Earlier [INR. 15,000 per Annum is exempted from Tax]; Now [CA
and MA cumulatively 40,000 per Annum is exempted from Tax]
Other Allowance The Balance (CTC – Everything); fully taxable
Provident Fund 13% (employer’s contribution) of Basic(Ceiling limit basic
1,80,000); fully tax exempted
Gratuity 4.81% of Basic; fully tax exempted
Employee State Insurance 4.75% (employer’s contribution) of Gross Pay, only if Gross Pay is
less than 2,52,000 per Annum; fully tax exempted](https://image.slidesharecdn.com/class5-190619084844/85/Class-5-payroll-processing-1-v7-0-14-320.jpg)
Class 5. payroll processing 1 v7.0
- 1. Jon Boyes Employability and Graduate Development CHMP www.hrspot.co.in Kolkata | Bhubaneswar | Hyderabad Best HR Practice Award Best HR Practice Award Best HR Practice Award Special Achievement Award (Star Greenbelt of East Six )Sigma Best HR Professional Award HR Champion Award &AWARDS ACCOLADES :ISO 9001 2008 Certified Company
- 2. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Certified Human Resource Management Professional Payroll Processing 1
- 3. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Introduction to Compensation and Benefits
- 4. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Company provides a return to its employees for the services rendered by them towards the fulfilment of organization goal Return in the form of monitory or non monitory or is a mixture of both
- 5. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Monetary returns are known as COMPENSATIONS Non Monetary returns are known as BENEFITS
- 6. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Objectives of Compensation and Benefits
- 7. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing C&B Program is a tool used by employers to effectively attract, retain and motivate employees
- 8. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Different Components of Compensation and Benefits
- 9. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Salary/Remuneration Overtime Incentive Bonus Commission Leave Encashment Compensation
- 10. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Pick up and Drop Work from Home Free Lunch and Dinner Corporate Mediclaim Preferable Week off Holiday Package Free Phone Life Insurance Club Membership Free Training Benefits
- 11. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Introduction to CTC
- 12. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC is a term for the total salary package of an employee. It indicates the total amount of expenses an employer spends on an employee during one year.
- 13. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Features and Components of CTC
- 14. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Components Features Basic Preferably (30 – 60) % of CTC in most cases; fully taxable House Rent Allowance 40% of Basic in Non Metro Location; 50% of Basic in Metro Location; partially taxable Leave Travel Allowance LTA is exempted from tax twice in a 4 years block Conveyance Allowance Earlier [INR. 19,200 per Annum is exempted from Tax]; Now [CA and MA cumulatively 40,000 per Annum is exempted from Tax] Medical Allowance Earlier [INR. 15,000 per Annum is exempted from Tax]; Now [CA and MA cumulatively 40,000 per Annum is exempted from Tax] Other Allowance The Balance (CTC – Everything); fully taxable Provident Fund 13% (employer’s contribution) of Basic(Ceiling limit basic 1,80,000); fully tax exempted Gratuity 4.81% of Basic; fully tax exempted Employee State Insurance 4.75% (employer’s contribution) of Gross Pay, only if Gross Pay is less than 2,52,000 per Annum; fully tax exempted
- 15. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Gross Pay and Gross Salary
- 16. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Cost To Company = The entire package Gross Pay = CTC – (Employer’s PF + Gratuity + all other deductions, if any, except ESI) Gross Pay is required for ESI calculation
- 17. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Gross Salary = CTC – All Deductions (Employer’s PF + Employer’s ESI + Gratuity + all other deductions, if any) Net Salary = CTC – All Deductions (Employer’s PF + Employer’s ESI + Gratuity + Employee’s PF + Employee’s ESI + all other deductions, if any)
- 18. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Cost To Company Employee Receivable Employee NOT Receivable Employer Contribution to Govt. Employer Contribution to Self Basic HRA Leave Travel Allowance Conveyance Allowance Medical Allowance Other Allowance Provident Fund (Employer) Employee State Insurance (Employer) Gratuity
- 19. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Gross Pay = CTC – All Employee Not Receivable (Except ESI) Employee Receivable Employee NOT Receivable Employer Contribution to Govt. Employer Contribution to Self Basic HRA Leave Travel Allowance Conveyance Allowance Medical Allowance Other Allowance Provident Fund (Employer) Employee State Insurance (Employer) Gratuity
- 20. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Gross Pay = CTC – All Employee Not Receivable (Except ESI) Employee Receivable Basic HRA Leave Travel Allowance Conveyance Allowance Medical Allowance Other Allowance Employee State Insurance (Employer) Gross Pay is important for ESI eligibility check only If GP is more than Rs. 2,52,000 not eligible for ESI
- 21. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Gross Salary = CTC – All Employee Not Receivable Employee Receivable Employee NOT Receivable Employer Contribution to Govt. Employer Contribution to Self Basic HRA Leave Travel Allowance Conveyance Allowance Medical Allowance Other Allowance Provident Fund (Employer) Employee State Insurance (Employer) Gratuity
- 22. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Gross Salary = CTC – All Employee Not Receivable Employee Receivable Basic HRA Leave Travel Allowance Conveyance Allowance Medical Allowance Other Allowance
- 23. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing CTC Designing
- 24. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing CTC Designing Example 1
- 25. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,80,000*40/100 = 72,000 Basic 40% of CTC Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 26. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 72,000*50/100 = 36,000 HRA 50% of Basic Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 27. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 72,000*13/100 = 9,360 Provident Fund (Employer) 13% of Basic Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 28. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 72,000*4.81/100 = 3,463 Gratuity 4.81% of Basic Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 29. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,80,000 – 9360 – 3463 = 1,67,177 Gross Pay (CTC – PF – Gratuity) Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 30. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Employees State Insurance (Employer) 4.75% of Gross Pay Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata 1,67,069*4.75/100 = 7,941
- 31. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 16,000Leave Travel Allowance Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 32. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 19,200Conveyance Allowance Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 33. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 15,000Medical Allowance Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 34. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,036Other Allowance Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 35. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,80,000 – 9360 – 3463 – 7941 = 1,59,236 Gross Salary (CTC – PF – Gratuity – ESI) Payroll Processing CTC Structure: INR 1,80,000 per annum in Kolkata
- 36. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC Structure: INR. 1,80,000 per annum in Kolkata . Components Amount Basic (40% of CTC) INR. 72,000 HRA (50% of Basic in Metro Location) INR. 36,000 LTA INR. 16,000 Conveyance INR. 19,200 Medical INR. 15,000 OA INR. 1,036 PF (employer) (13% of Basic) INR. 9,360 Gratuity (4.81% of Basic) INR. 3,463 ESI (employer) (4.75% of Gross Pay) INR. 7,941 Gross Pay = CTC – PF - Gratuity
- 37. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC Structure: INR. 1,80,000 per annum in Kolkata Components Amount Basic INR. 72,000 House Rent Allowance INR. 36,000 Leave Travel Allowance INR. 16,000 Conveyance Allowance INR. 19,200 Medical Allowance INR. 15,000 Other Allowance INR. 1,036 Provident Fund INR. 9,360 Gratuity INR. 3,463 Employees State Insurance INR. 7,941 Total INR. 1,80,000 CTC= 1,80,000 Gross Pay (CTC – PF – Gratuity)= 1,80,000 – 9360 – 3463= 1,67,177 Gross Salary (CTC – PF – Gratuity – ESI)= 1,80,000 – 9360 – 3463 – 7941= 1,59,236
- 38. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing CTC Designing Example 2
- 39. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 6,00,000*50/100 = 3,00,000 Basic 50% of CTC Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 40. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 3,00,000*40/100 = 1,20,000 HRA 40% of Basic Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 41. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,80,000 (maximum ceiling limit)*13/100 = 23,400 Provident Fund (Employer) 13% of Basic Payroll Processing CTC Structure – INR 6,00,000 per annum in Bhubaneswar
- 42. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 3,00,000*4.81/100 = 14,430 Gratuity 4.81% of Basic Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 43. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 6,00,000 – 23,400 – 14,430 = 5,62,170 Gross Pay (CTC – PF – Gratuity) Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 44. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Employees State Insurance 4.75% of Gross Pay Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar Gross Pay more than 2,52,000 per annum, so ESI is 0
- 45. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 1,00,000Leave Travel Allowance Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 46. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 20,000Conveyance Allowance Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 47. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 20,000Medical Allowance Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 48. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Other Allowance Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar 2,170
- 49. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards 6,00,000 – 23,400 – 14,430 – 0 = 5,62,170 Gross Salary (CTC – PF – Gratuity – ESI) Payroll Processing CTC Structure: INR 6,00,000 per annum in Bhubaneswar
- 50. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC Structure: INR. 6,00,000 per annum in Bhubaneswar Components Amount Basic (50% of CTC) INR. 3,00,000 HRA (40% of Basic in Non Metro Location) INR. 1,20,000 LTA INR. 1,00,000 Conveyance INR. 20,000 Medical INR. 20,000 OA INR. 2,170 PF (employer) (13% of Basic: more than 1,80,000) INR. 23,400 Gratuity (4.81% of Basic) INR. 14,430 ESI (employer) (4.75% of Gross Pay: more than 2,52,000) INR. 0 Gross Pay = CTC – PF - Gratuity
- 51. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC Structure: INR. 6,00,000 per annum in Bhubaneswar Components Amount Basic INR. 3,00,000 House Rent Allowance INR. 1,20,000 Leave Travel Allowance INR. 1,00,000 Conveyance Allowance INR. 20,000 Medical Allowance INR. 20,000 Other Allowance INR. 2,170 Provident Fund INR. 23,400 Gratuity INR. 14,430 Employees State Insurance INR. 0 Total INR. 6,00,000 CTC= 6,00,000 Gross Pay (CTC – PF – Gratuity)= 6,00,000 – 23670 – 14430= 5,62,170 Gross Salary (CTC – PF – Gratuity – ESI)= 6,00,000 – 23400 – 14430 – 0= 5,62,170
- 52. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing Payroll Processing Class Activity
- 53. . . .www hrspot co in | ISO Certified | Winner of 8 Service Excellence Awards Payroll Processing CTC Structuring All Students will be asked to make CTC structure for different Metro and Non metro locations. 1.CTC 2,50,000; location Kolkata; Basic 35% 2.CTC 3,25,000; location Bhubaneswar; Basic 45% 3.CTC 4,75,000; location Hyderabad; Basic 55% 4.CTC 1,75,000; location Noida; Basic 40% 5.CTC 6,55,000; location Thiruvananthapuram; Basic 50% Individual Activity: 120 min
- 54. www.hrspot.co.in Registered Office | 146 Bacharpara Road No-2, Thakurpukur Kolkata, West Bengal-700063 Training Location Kolkata | Bhubaneswar | Hyderabad +91-8335844414 | +91-8479908067 knowledge@hrspot.co.in | campus@hrspot.co.in