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Salary components, structures and revisions

Build every salary component on a form and group them into templates. Give each employee a salary by annual CTC or monthly gross with the breakup worked out, and keep every revision with its date.
PLANSFrom Growth
Compare plansHow it works

The problem it solves

  • The salary breakup lives in a spreadsheet formula that only one person in accounts understands.
  • A new allowance or a change in the HRA rule needs a call to the vendor and a wait.
  • Someone offered a CTC, and nobody can say what the monthly gross and take-home will be.
  • Last April's increment overwrote the old salary, so you cannot show what was paid before.

How it works

  1. Set up your components under Payroll > Configuration > Salary Components: Basic, HRA, Special Allowance, your own allowances and deductions. For each, choose how it is calculated from a list, with no code.
  2. Group the components into a salary template for each kind of staff, such as Office staff or Drivers. The Standard (India) template comes ready with Basic, DA, HRA, Conveyance, Special Allowance, Overtime, PF, ESIC, professional tax, LWF and income tax.
  3. Give a salary under Payroll > Salaries > Employee Salaries: the template, Annual CTC or Monthly gross, the amount, Effective From and the reason.
  4. Press Show Breakup. The Monthly Breakup lists each component for a full month. Type a Fixed Amount for This Employee where one person's figure differs.
  5. Press Make Active. The earlier salary ends the day before, and the list keeps every revision.
  6. For a new structure for many people, export the salaries and import them back as drafts. Select them and press Make Active.

Everything it does

How a component is calculated (Calculated As)

  • Fixed amount
  • % of chosen components (for example HRA as 40 % of Basic)
  • % of CTC (monthly) or % of gross (monthly)
  • Balance of gross: what is left after the other earnings, so the gross always adds up
  • Rate x quantity: paid days, days worked, overtime hours, hours worked (part-time), days on a shift, or a quantity typed each month
  • The rate of a rate x quantity component can come from other components, such as Basic divided by 208 for one overtime hour
  • Slab table: a value or a percentage read from ranges, on the gross or on the components you pick
  • Monthly input: typed each period under Monthly Inputs
  • Statutory: PF, voluntary PF, EPS, EDLI, PF admin charges, ESIC, professional tax, LWF and income tax, worked out by the product
  • Expression, for rare cases: component codes with + - * /, brackets and MIN, MAX, ROUND, ABS. The builder checks it and shows a sample result

Properties of each component

  • Category: Earning, Deduction, Employer Contribution, Reimbursement, or Information (not paid)
  • Reduced for Loss of Pay: on to start with
  • Taxable, with an exemption rule: HRA, LTA, conveyance, leave encashment on exit, gratuity or other
  • Counts towards PF Wages, ESIC Wages, Gratuity Wages and Bonus Wages
  • Part of CTC: on to start with
  • Rounding: nearest whole amount (the default), up, down or none
  • Minimum and Maximum amounts
  • Paid every month, quarterly, once a year or one time, with the months it is paid in
  • Shown on the payslip or not
  • Only for some staff categories, employment types, grades, a gender or states

Salary by CTC or by gross

  • Monthly gross: the components share out the gross you type
  • Annual CTC: the product finds the gross that, with the employer contributions in the CTC, equals the CTC
  • Hourly or daily paid staff need no monthly amount when their template has only rate x quantity, input and statutory components
  • Standard (India) starts with Basic at 50 % of gross, HRA at 40 % of Basic, Conveyance 1,600, Special as the balance
  • A template line can carry its own amount or percent; empty, it takes the component's

Revisions and history

  • Each salary has Effective From, Until and a reason: joining, increment, promotion, correction or other
  • Statuses: Draft, Active, Ended, Cancelled
  • A new salary cannot start on or before the start of the active one
  • A salary already used by payslips cannot be cancelled
  • A revision dated in a month already paid is paid as arrears in the next payslip, with the PF and ESIC difference
  • Bulk change: import drafts, then Make Active on the selected rows of the list; rows not in draft are skipped

Who sees salaries

  • Payroll Officer and Payroll Manager roles work on salaries; payroll reads the employee details it needs without HR rights
  • A salary marked confidential is seen only by those with the Confidential Salaries role
  • Employees see the breakup on their own payslips under Payroll > My Payslips and in the app, not the salary record itself

Who uses it

Payroll ManagerSets up components, slab tables and templates, and the Entity's payroll settings.
Payroll OfficerGives salaries, shows the breakup, makes revisions active and runs bulk changes.
HR officerSees the salary history on the employee's record, within the Entities given to them.
EmployeeSees the breakup on their own payslips.

Where you use it

  • Web: Payroll > Configuration (Salary Components, Salary Templates, Slab Tables) and Payroll > Salaries > Employee Salaries
  • The SmartMy HRMS app: employees see their payslips with the breakup (built and in testing, not in the app stores yet)
  • Not in the app: setting up components and giving salaries are done on the web

What you control

Settings

  • Payroll Rules per Entity: India (PF, ESIC, PT, LWF, income tax), the default
  • One Day's Pay Is: calendar days of the period (the default), 30 days, or working days of the period
  • Per component: Reduced for Loss of Pay on, Part of CTC on, rounding to the nearest whole amount, all as starting points
  • Components and templates for one Entity or, left empty, for every Entity of the group

Approvals

  • Salaries themselves are made active by payroll without a chain. Increment cycles that change many salaries go through their own approval (see Increments, revision planner and bonus)

Works with

SmartMy CampusGuest faculty get a salary template with no fixed pay and a lecture fee for each lecture taken from the timetable.
SmartMy ProjectsAn hour on a project costs the monthly CTC or gross divided by the hours of a month (176 to start with).

Questions

Can we set up our own allowances without asking you?

Yes. A component is a form. You choose how it is calculated, whether it counts for PF, ESIC, gratuity or bonus, whether it is taxable, and who gets it.

We offer salaries as CTC. Does the system work out the gross?

Yes. Choose Annual CTC and type it. The product finds the gross that, with the employer contributions in the CTC, equals it, and shows the monthly breakup.

What happens when an increment is entered late?

Make the new salary active with its real Effective From. If that month is already paid, the next payslip pays the difference as arrear lines. Arrears look back up to 12 months.

Can we change the structure for 500 people at once?

Yes. Export the salaries, change the template and date in the sheet, import them as drafts, select them in the list and press Make Active.

Can we pay people outside India with these structures?

Partly. An Entity outside India can use pay preparation. The product works out earnings and your own deductions and gives a file to the local payroll provider. It does no foreign tax.

Can I see what someone earned two years ago?

Yes. Every salary keeps its Effective From and Until dates, its reason and its breakup, and old ones are never overwritten.

Related features

PAYROLLPayroll runs, approval and lockRun payroll per Entity and pay period straight from the attendance record, with joiners, leavers and mid-month revisions worked out. Approvers review it on one screen, salaries can be held and released, and a paid payroll is locked and reopened only with a reason.LOANS, INCREMENTS, BONUSIncrements, revision planner and bonusTry salary revision scenarios against your budget. Run the yearly increment cycle with proposals, approval by HR then top management, letters and arrears. Pay the statutory bonus and your own bonuses through payroll.STATUTORY AND TAX, INDIAPF, ESI, professional tax, LWF and minimum wageEvery payslip works out PF with VPF, pension and EDLI, ESI, professional tax and the labour welfare fund from your Entity's settings. The ECR file, the ESIC sheet, the register of wages and the muster roll come out of the same payroll run.PAYROLLDaily, weekly and fortnightly wage runsPay workers daily, weekly, every two weeks or twice a month from their attendance, with statutory deductions held back on each wage slip. The monthly payslip stays the one statutory payslip and settles the balance.ATTENDANCEOvertime, comp-off and short leaveOvertime is counted from the punches by your overtime rule and either paid through payroll at your rates or turned into comp-off. Work on a weekly off or a holiday earns comp-off by claim. Short permissions of an hour or two stay within your monthly limits.LINKS AND PLATFORMGo-live import from ExcelBring your employees, their PAN, UAN and bank accounts, opening leave balances and this month's attendance in from one Excel workbook. Starting mid-year, add the months already paid, open loans and the assets people hold, so tax and payroll are right from the first run.

See your own month run in it.

Tell us how many people you have, how you take attendance and how your salary is structured. We will show you SmartMy HRMS set up that way.
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