A salary slip template is a statement that the employers provide to employees each time they receive their earnings. For employees, this document serves as proof of their earnings and employment. It tells the employee about the gross pay, deductions done, and the remaining net pay.
Table of Contents
- 1 What is a Salary Slip?
- 2 The different types of payroll services:
- 3 Which components form the income/earning and deduction sides of salary?
- 4 What special allowance salary slip contains?
- 5 Does Excel have a salary slip template?
- 6 How Do You Create a Salary Slip in Excel?
- 7 The benefits of having an online payroll slip:
- 8 Faqs (Frequently Asked Questions)
- 9 Is handwritten payroll slips illegal?
- 10 Does the bank check your salary slip when you are applying for a loan?
- 11 Does a higher basic salary enhance your tax liability?
What is a Salary Slip?
A salary slip, also known as a payslip, is a document that an employer provides to its employees monthly. This slip includes a comprehensive breakdown of employees’ salary and subtraction for a given period. It could be available either in hard copy or mailed to the employees. The employee can download it in PDF format but the salary slip made in MS Word or MS Excel. The components are the same in both Word and Excel but the formats are slightly different.
The different types of payroll services:
Let us discuss below the different types of payroll services that your company may implement in order to become more personnel to handle the task;
The In-house payroll services
You may apply the in-house payroll services if you are a small business owner having relatively few employees. Your payroll staff won’t have difficulty handling your payroll system, especially if you have less than ten employees currently employed in your office. To process your payroll task, you may also use payroll software. Also, it will keep you up-to-date with salary norms and other important payroll data.
The Bookkeeper’s and CPAs’ payroll services
Payroll can be processed by getting the services of professional bookkeepers and CPAs (Certified Public Accountants). You just have to pay them as per their daily performance. They are the ones who will handle all your company’s sensitive data including;
- Financial reports
- Financial statements
- The maintenance of your employee’s data
Remember that you must hire competent and trustworthy bookkeepers and CPAs.
The Payroll Services Agency
To handle and deliver your payroll and other financial processes, your company may also get the services of a payroll agency. Since these agencies have professionals to handle your daily business operations, payroll, and other direct bank deposits so you don’t have to worry about your accounting and other administrative activities. In addition, the company’s financial data can be stored, searched, retrieved, and secured easily with the help of technology.
Which components form the income/earning and deduction sides of salary?
Components that form the earning side of salary slip are basic salary and allowances. There are different types of allowances such as dearness allowance, medical allowance, HRA (House Rent Allowance), special allowance, and LTA (Leave Travel Allowance).
Components that form the deduction side of salary slip are provident fund, ESI, professional tax, income tax (TDS), and advance salary if any.
What special allowance salary slip contains?
Employers provide special allowances to their employees to meet certain needs over and above their salaries. It varies between companies. These allowances are performance-based. They are given to the employees to motivate and encourage them to work better. These allowances are 100% taxable. Special allowances have appeared on the earning side of the salary statement. The salary special allowances exempt in some cases like other allowances that include LTA (Leave Travel Allowance), travel allowance, and HRA (House Rent Allowance).
Does Excel have a salary slip template?
Yes, Excel has a well-formatted salary slip template made from a straightforward spreadsheet. It also allows its users to modify the format and the calculation formulae utilized. You must look at the built-in templates as they save you a lot of time.
Furthermore, Excel salary slip templates contain all the components of the employee’s salary like House Rent Allowance, bonuses paid, deductions for a specific period, overtime, taxes, and more. These templates are fully customizable and have corporate and specific employee details.
How Do You Create a Salary Slip in Excel?
Below we are going to discuss step-by-step how to create a salary slip in MS Excel;
- At first, add general information about the company. It may include the company name, address, phone number, company logo, and any other information that you want regarding the company.
- Next, state that which month salary you are going to pay for.
- Then, include all the information about the employee. It may include an employee’s name, number, gender, designation, department, ID, date of joining, and address.
- After entering an employees’ general information provide his/her bank account number, bank name, UAN number, ESI, and PAN number.
- Next, provide the information about the interval of paid days; LOP days, and days in a month.
- When the above steps are completed insert the salary details as per break-up. At first, add the gross salary as per break-up. The structure of salary contains “Basic Salary,” “HRA,” and “Special Allowances”. These are the basic components of a fixed salary.
- Now you can add additional earnings such as incentives, bonuses, overtime, etc.
- After done with the earning section, state all the deductions as per the rules of the government. These deductions involve provident fund, ESI, professional tax, income tax (TDS), and any other deductions as well (advance salary).
- The last step is to reach the net payment amount. You can calculate a net payment amount by the following formula;
Net payment amount= total earnings- total deductions
As you find the net payment amount, your salary slip format is ready to use.
The benefits of having an online payroll slip:
- Your company doesn’t have to purchase many paper supplies and does not maintain equipment to print the slips by having an online payroll slip. This way, you can save your finances. A little process is required to complete your payroll process as you don’t have to print your payroll slips.
- Your company doesn’t have to produce a lot of paper and would no longer need much ink for printing as all your payroll slips are forwarded through email. Other employees can’t know your monthly salary as your payroll slip is stored online. Also, there is less chance of losing your payroll slips in the area.
- Employees’ payroll slips are automatically stored in their email accounts when a company sends them to their respective email accounts. It doesn’t matter whether they are at work or at home, they can easily access their salary slips on their personal computers and on their mobile phones.
Faqs (Frequently Asked Questions)
Is handwritten payroll slips illegal?
No, handwritten salary slips aren’t illegal. Since they are insufficient evidence of someone’s current income, therefore, most banks and money lenders don’t accept them.
Does the bank check your salary slip when you are applying for a loan?
Yes, banks and other money lenders check your salary slip during transactions to verify your eligibility for one.
Does a higher basic salary enhance your tax liability?
Yes, the tax deduction amount gets higher when you have a higher basic salary.