What this covers
Running payroll each month and discharging what attaches to it: gross to net against the salary structure, withholding on salary built from the employee's own declaration rather than a flat estimate, provident fund and pension contributions, employees' state insurance where the establishment is covered, profession tax in each state that levies it, gratuity and bonus when they fall due, and the registers and returns each statute requires. It also covers the two points at which payroll usually goes wrong: the salary structure, and exits.
Statutory basis
The Employees' Provident Funds and Miscellaneous Provisions Act, 1952; the Employees' State Insurance Act, 1948; the Payment of Gratuity Act, 1972; the Payment of Wages, Minimum Wages and Payment of Bonus Acts; and the shops and establishments and profession-tax enactments of each state. Withholding on salary is governed by the Income-tax Act, 2025, in force from 1 April 2026, which repealed the Income-tax Act, 1961 — the corresponding provision was section 192 of the old Act, with the annual salary certificate in Form 16 and the quarterly statement in Form 24Q under the 1962 Rules. Those references changed with the Income-tax Rules, 2026, so we confirm the current form before each filing. The four labour codes of 2019 and 2020 consolidate these enactments; their commencement and the state rules giving them effect have been staged, so we confirm which enactment governs an obligation for your establishment and state.
Who it applies to
Provident fund coverage begins at the headcount in section 1(3) of the 1952 Act; below it, voluntary coverage under section 1(4) is available and cannot later be given up. Employees' state insurance applies in a notified area at the notified headcount, and the wage ceiling for coverage is in the rules. Gratuity applies on the continuous service the 1972 Act specifies. Profession tax is a state levy and Delhi does not impose one, so employing someone in a state that does levy it starts that state's registration and returns. The principal employer answers for a contractor's provident fund and insurance compliance.
What we do
- 1Establish coverage first: which statutes apply on headcount, wage level and location, and from what date liability arose — liability runs from the date of coverage, not of registration.
- 2Build the employee master and test the salary structure against the definition of wages that provident fund, gratuity and bonus each use; the labour codes move to a single definition with a floor on the proportion basic pay bears to total remuneration, which raises contributions where allowances are heavy.
- 3Run the monthly cycle: attendance and leave, gross to net, and withholding on the employee's declared regime and investments, revised through the year so the last quarter does not absorb the shortfall.
- 4Deposit and file on time: the challan-cum-return and provident fund contribution by the fifteenth, insurance by the fifteenth, profession tax by each state's date, tax deducted by the seventh, and the quarterly statement.
- 5Maintain the wage register and muster roll, take nominations in Form F under the Gratuity Act, and seed universal account numbers and insured-person numbers with know-your-customer details.
- 6Compute gratuity and bonus when they fall due — the ceilings and limits are in the respective Acts as amended — and handle exits: full and final settlement, gratuity paid within the period the Act allows, provident fund transfer, and the part-year salary certificate.
What you receive
- Monthly payroll
- The register with gross to net for each employee, the bank payment file, and the reconciliation to the ledger.
- Payslips
- Individual payslips showing earnings, deductions and the withholding basis.
- Filings
- Provident fund, insurance, profession-tax and withholding filings on one calendar.
- Statutory records
- The registers, nominations and returns each Act requires.
- Year-end set
- Annual salary certificates and the fourth-quarter statement.
Documents and information required
Employee master with date of joining, location and full salary structure · attendance, leave and overtime records · appointment letters · permanent account number and Aadhaar of each employee · bank details · provident fund, insurance and profession-tax credentials and portal access · previous employer salary details for mid-year joiners · regime, investment and rent declarations with proof · contractor agreements with proof of the contractor's own compliance.
Key dates
The provident fund challan-cum-return and contribution are due by the fifteenth of the following month, and the insurance contribution by the fifteenth, with contribution periods running April to September and October to March. Tax deducted from salary is deposited by the seventh of the following month, with the different date the Rules give for March; the quarterly statement and annual salary certificate follow on the dates the Income-tax Rules, 2026 prescribe. Gratuity is payable within thirty days of becoming payable under section 7(3) of the 1972 Act. Bonus under section 19 of the 1965 Act is paid within eight months of the close of the accounting year.