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All-in-one HR platform · v2.0
14-day free trial · No credit cardhello@HrMagix.com
All-in-one HR platform · v2.0
14-day free trial · No credit cardhello@HrMagix.com
EPF, ESI, professional tax, the labour welfare fund, TDS under Section 192, Form 16 and gratuity.
HRMagix calculates monthly statutory deductions automatically based on active employee wage structures. It generates EPFO-ready ECR text files, ESIC monthly contribution reports, state-specific Professional Tax (PT) calculations matching slabs for Maharashtra, Karnataka, Telangana, and other states, as well as monthly TDS calculations with quarterly Form 24Q and annual Form 16 Part B generation.
Built in. EPF, ESI, professional tax by state, labour welfare fund and TDS under Section 192 are calculated inside the payroll run from the salary structure on the employee record and the registrations you hold. The same run produces the payslips, the ECR and ESIC files, the PT working, Form 24Q and Form 16 Part B, so the return and the ledger are built from one set of figures rather than reconciled afterwards.
EPF is calculated at 12% employee and 12% employer contribution, with the ₹15,000 statutory wage ceiling available as a configurable cap and voluntary PF supported where an employee elects it. ESI applies at 0.75% employee and 3.25% employer against the ₹21,000 gross wage threshold, with contribution-period rules respected rather than a naive month-by-month test. Both produce filing-ready output: an ECR file for the EPFO portal and a monthly contribution return for ESIC.
HRMagix generates Part B of Form 16 annually from the same payroll data used for the monthly TDS schedule and quarterly Form 24Q. Part A is issued by TRACES against the employer's TAN.
Substantially. Basic pay drives the PF wage; the split between basic, HRA and special allowance drives what is exemptible; and whether a component sits inside the gross drives ESI eligibility near the threshold. These are decisions made once per grade, and they are the reason two packages of the same total can cost the employer different amounts.
Where the employee has completed five years of continuous service, the settlement includes gratuity computed on the Payment of Gratuity Act formula of fifteen days of last drawn basic salary per completed year. Provisioning runs before that point so the liability is visible rather than sudden.
The statutory pieces are the argument for starting early, not the module count. Registering the right identifiers and applying the correct EPF, ESI, PT and TDS treatment from your first employees costs nothing extra and avoids a retrospective correction later. The Starter plan exists for exactly this size.
It depends on your state and establishment type rather than on headcount alone. Professional Tax registration commonly applies from the first employee; ESI generally from ten in a covered establishment; EPF generally from twenty, though voluntary coverage is common. TDS applies from the first salary above the exemption limit. The platform holds the registrations you tell it you have and derives the deductions from them.
State-specific rule sets are configured for Maharashtra, Karnataka, Telangana, Tamil Nadu, Andhra Pradesh, Gujarat and West Bengal, including the February slab change and gender-specific exemptions where a state provides them. Applicability follows the employee's work location on the record.
Yes, and they should be. Shift patterns, overtime treatment and attendance capture differ by population; the PF and ESI registrations, the returns and the wage registers do not. Keeping both in one run is what stops the statutory output needing reconciliation before every filing.
As distinct categories on the employee record, because the category determines PF applicability, ESI eligibility, TDS treatment and gratuity accrual. Partners paid through drawings sit outside payroll; trainees on a stipend have their own treatment. The important thing is that the distinction is a recorded field rather than knowledge held by whoever runs payroll.
Both are permitted. Capping at the statutory wage ceiling reduces the contribution on both sides for anyone whose basic exceeds ₹15,000; contributing on full basic increases the employee's retirement corpus and the employer's cost. It is a policy decision, applied consistently across the organisation, and it is configurable in HRMagix.
No. Professional Tax and Labour Welfare Fund are state subjects with different slabs, exemptions and periodicity in each state, so neither is included.
Only where monthly gross is ₹21,000 or less. In that case the employee contributes 0.75% and the employer 3.25% of gross; above it, both ESI lines show as not applicable.
PF lines are rounded to the nearest rupee and ESI lines up to the next rupee, as EPFO and ESIC require, and totals sum the rounded parts, which is how a payslip is actually produced.
Because the pension share is computed on the PF base capped at the ₹15,000 statutory ceiling, even when the employer has chosen to contribute on full basic. Once basic passes ₹15,000 the EPS figure holds steady and the additional employer contribution goes to provident fund instead.
An employee may contribute more than the statutory 12% of their PF base. The employer's contribution does not increase to match. It is included here as a separate line so the effect on take-home is visible.
No. EPFO declares an interest rate each year, and applying an assumed rate to future balances would be a projection rather than a calculation. The annual figure shown is contributions only.
Enter monthly basic plus dearness allowance, not gross. Where the ₹15,000 wage ceiling is applied, the PF base is the lower of that figure and ₹15,000.
8.33% of the PF base, capped at the ₹15,000 ceiling, goes to the Employees' Pension Scheme. The remainder of the employer's 12% goes to provident fund.
The calculator totals the employee and employer contributions each month and multiplies by twelve. That annual figure is contributions only, before any interest credited by EPFO.
The calculator does not determine that. Applicability of the scheme to a particular establishment and employee is a question for your advisers or the EPFO.
The employee contributes 0.75% and the employer 3.25% of gross wages, each rounded up to the next rupee, for employees within the ₹21,000 monthly threshold.
Yes. The threshold is inclusive, so monthly gross wages of ₹21,000 or less fall within the scheme.
Shift differentials and attendance-linked allowances count towards gross. Overtime counts for contributions but not for the coverage test. Whether a specific allowance forms part of the wage base is a question for your advisers or the ESIC.
The Payment of Gratuity Act computes a daily wage on a twenty-six day month, reflecting working days rather than calendar days. Using thirty would understate the entitlement.
On last drawn basic salary plus dearness allowance, not on gross. This is why a salary structure with an unusually low basic reduces both present provident fund contributions and future gratuity.
It is not payable, but the liability is accruing. The calculator shows what would be payable at five years on the current basic, which is the figure worth provisioning against, so that a long-serving employee reaching eligibility is a settlement rather than a surprise on the books.
Gratuity = (15 ÷ 26) × last drawn basic plus DA × years of service, payable once five years of continuous service are complete, and capped at ₹20,00,000.
Yes. The amount payable under the Payment of Gratuity Act is capped at ₹20,00,000, and the calculator shows the uncapped figure alongside when the cap applies.
Gratuity becomes payable on completing five years of continuous service, but the Act also prescribes circumstances in which the five-year condition does not apply.
No. The tax treatment of gratuity in a full-and-final settlement has its own rules and is not addressed by this calculator.
No, and particularly not across the ESI threshold. An average that straddles ₹21,000 will apply ESI either to everyone or to nobody, when in reality it applies to part of the workforce. Run the calculator once per salary band and add the results.
No. Gratuity accrues per employee against their length of service rather than as a flat monthly percentage, so it cannot be represented by a headcount average. The gratuity calculator handles it per employee.
Because they come out of the employee's gross and reduce take-home rather than adding to the employer's cost.
No. Both are state subjects, so they are left out, as is gratuity provisioning, which depends on individual service length.
Fifteen twenty-sixths of monthly basic per year of service, spread across twelve months. It is an accounting convention; gratuity itself is only payable after five years of continuous service.
Only where monthly gross is within the ₹21,000 threshold, in which case 3.25% of gross is added. Above the threshold, nothing is added for ESI.
No. The employer's 12% provident fund contribution is added in full, and how it divides between EPF and EPS does not change the total.
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