sumopayroll
Apr 29, 2022

What are payments and deductions required for running a payroll?

Let’s first understand what the payments and deductions provided by the employer

Payments: Any amount disbursed to an employee by the employer falls under underpayments. They include the following:

Basic pay
Special Allowances
Children’s Education Allowances
HRA
Bonuses
Commissions/incentives
Overtime pay
Expenses
Leave Encasement
Gratuity

Deductions: Any amount which is deducted from an employee’s Gross pay falls under deductions. Moreover, they include :

Provident Fund
Professional Tax
Employee state Insurance (ESI)

Advance/Loans
TDS deduction
Loss of pay
Health Insurance

Now before running the payroll, the employer should collect all their employee’s monthly attendance, leaves taken by the employees, Loss of pay, any deductions, advances or loans, expenses to be reimbursed, bonuses or commissions to pay, and then finally run the payroll.

Collecting and processing the above data takes a lot of time and effort including payments and deductions is also time-consuming. However, to save time and reduce errors, if one can automate their payroll process by adopting digitized payroll software/application it would be a better choice.

Finally, SumoPayroll is an accurate and easy-to-use cloud-based Payroll and HR application It is among the top of India’s leading HR & Payroll software companies and is packed with features that will help streamline your HRMS & Payroll, and deductions.