B. Deductions Components
| Components | Description | Excel Formula |
|---|---|---|
| 1. ESI (Employee) |
ESI for employees is governed by the State Government and calculated as 0.75% of Gross Salary. Condition: Not applicable if the Gross Salary exceeds ₹21,000. |
IF(Gross < 21001, Gross × 0.75%, 0) |
| 2. PF (Employee) |
PF is governed by the Central Government as part of the social security scheme. It is calculated as 12% of (Gross – HRA). Note: If (Gross – HRA) exceeds ₹15,000, PF is capped at ₹1,800/month. |
IF((Gross – HRA) < 15001, (Gross – HRA) × 12%, 1800) |
| 3. Professional Tax (PT) |
Professional Tax is levied by the State Government and is a fixed monthly deduction based on salary slabs. Example: In Karnataka, if Gross Salary is above ₹24,999, PT = ₹200; otherwise, it is ₹0. |
Fixed rate as per state slab |
| 4. Net Pay |
Also called In-Hand Salary or Take-Home Salary. It is calculated by subtracting all deductions (PF, ESI, PT, Income Tax, etc.) from the Gross Salary. |
Gross – Total Deductions |
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