What is salary certificate
A salary certificate is an official document that must contain an employee monthly total earnings. Salary slip is document issued by employer to a working employee in his organization. Monthly total gross earning during the month like basic salary, house Rent Allowance, Leave travel allowance their breakups and a summary of net salary received during the month.
Components of Salary slip
Salary slip can divided into two part and its provided by both employer ,Government and private.
Salary slip contain the following information
1.Basic Salary. Its is a main component of salary and its basis of various other component of salary.
2. Dearness Allowance: It is given to employee for inflation in the market
3. House Rent Allowance: HRA is paid to employee for house rent paid by employee for his accommodation.
4. Conveyance Allowance: It paid to employee for travel cost from office to home and home to office and other official work.
5. Other allowance like, Bonus, Medical allowance, leave travel allowance: It is paid to employee on time to time to encouraged that organization care him like a family member.
In the salary slip also mentions some deductions
- Provident Fund: It is deduction from gross salary of employee on certain percentage on basic salary if his employer registered under Provident fund scheme.
- Tax Deducted at source: TDS is deducted from gross salary of an employee on behalf of Central Government of India. It is deducted if employee salary come under tax slab during the relevant financial year.
- Other deductions: like any loan , donation etc.
Importance of a salary slip
Proof of employment:
Salary slip is a important legal document to that prove he is employee of such organization and earn monthly salary as mention in the salary slip.
2. Help to Borrow:
If any employee want to borrow loan for Car, Home, Personnel salary slip can help to assure to lender he will repay loan.
3. New Job offers:
If employee want to change his job from one employer to other salary slip can help.
Salary slip format
|COMPANY DETAILS ON LETTERHEAD|
|PAYSLIP FOR THE MONTH OF_________20___|
|Bank A/C No.||Total days|
|ESIC No.||Work Days|
|PAN No.||Effective work days|
|Transport Assistance||Income Tax|
|Taxable Food Allowances|
|Night Shift Allowance|
|Total Earnings||Total Deduction|
|Net Pay in Rs.:|
|Net Pay in Words:|
Signature of Employer
download salary slip format in excel
download salary slip in word format
Break – up of salary certificate shall be in the following headers:
Gross pay and allowances (to be shown on certificate of salary):
- Under this head , salary certificate form shows the amounts an employee is entitled to get, from the employer.
- Salary certificate shoes the gross salary amount, which will be the sum total of all the figures.
- Under the deductions head, salary certificate letter shows all the figures of sum that are required to be deducted from the salary like, Income tax and other taxes to be deducted at source also known as TDS, installments of loans / advances repayable by the employee, provident fund contribution etc.
- At the end of the section of the salary certificate letter, show the sum total of the deductions.
Occasions that salary certificate required :
When you apply for a bank loan most of the banks ask you to documents along with the loan application in which the important documents are : KYC documents (Photos , address , proof/ration cards , ID proof , Passport ), certificate of salary or salary certificate/ latest salary slip showing all the deductions and TDS certificate – Form 16 in case of you are a salaried person.