Introduction
With SalaryBox, establishing the salary cycle is straightforward. Moreover, configuring salary heads, including adding various allowances, defining employer contribution categories, and specifying deduction categories, is now efficiently manageable with SalaryBox.
How to set up the Salary Cycle
Tap on ‘Settings’ in the top right corner
Look for ‘Salary Settings’
Now you will see the following three salary settings:
Calendar Month
30 Day Month
26 Day Month
Let’s understand these salary settings in detail:
Calendar Month
When calculating salary based on the number of days in a month, consider that January has 31 days and February has 28 days. Therefore, the salary will be adjusted according to the specific number of days in each month.
Example
Monthly Salary: Rs. 40,000
Month: January
No. of days: 31
No. of Present days: 27
No. of Absent days: 4
Final Salary: Rs. 34,830
30 Day Month
Whenever the salary is calculated, this setting will consistently use 30 days as the basis for a month, regardless of the actual number of days in the month.
Example
Monthly Salary: Rs. 40,000
Month: January
No. of days: 31
No. of Present days: 27
No. of Absent days: 4
Salary calculation (Formula):
Monthly Salary / No. of days absent = Deduction Amount
Monthly Salary - Deduction Amount = Actual Salary
Salary calculation (Formula):
40,000 / 4 = 10,000
40,000 - 4,000 = 36,000
Final Salary: Rs. 36,000
26 Day Month
Whenever the salary is calculated, this setting will consistently use 26 days as the basis for a month, excluding 4 Sundays as days off, regardless of the actual number of days in the month.
Example
Monthly Salary: Rs. 40,000
Month: January
No. of days: 31
No. of Present days: 27
No. of Absent days: 4
Salary calculation (Formula):
Monthly Salary / 26 = Per day salary
Monthly Salary / No. of days absent = Deduction Amount
Monthly Salary - Deduction Amount = Actual Salary
Salary calculation (Formula):
40,000 / 4 = 10,000
40,000 - 4,000 = 36,000
Final Salary: Rs. 36,000
Attendance Cycle
Next, you'll need to select the start date from which we will calculate the working days. This is important because it will determine the payroll period for your employees.
To do this:
Look for the drop-down menu labeled "Start Date".
Click on the drop-down menu to open the calendar.
Choose the date that aligns with your payroll cycle. For example, if your payroll cycle starts on the 1st of each month, select the 1st of the current month.
If your payroll cycle follows a different pattern, such as starting on the 15th or 20th of the month, choose the corresponding date.
Selecting the correct start date ensures that the payroll calculations are accurate and that your employees are paid correctly for the designated period.
Setup the Salary Heads
Allowance Heads
Let’s add the allowance heads first, though you will be getting a few Default Allowances like Basic, HRA, and Dearness Allowance.
You will be getting other allowances like, Fuel, LTA, Medical, Internet, Laptop Allowance, and whatnot.
You can simply tap on > ‘Add Allowance’ to execute this.
Employer Contribution Heads
You can easily add Employer PF Contribution and Employer ESI Contribution. You can select heads on which you calculate PF and ESI by simply tapping on the +Add icon.
Employer Contribution Heads
You can easily deduct Employee PF Contribution and Employee ESI Contribution.
You can select heads on which you calculate PF and ESI by simply tapping on the +Add icon. Calculations can be set at the staff level.
Also, you can add other deductions like ‘Medical Insurance Premium, Gatutity, Security deposit, etc.’ by simply clicking on ‘+Add Deduction’.
Once done, click on ‘Save Salary Heads’.