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Salary Slip: Format, Components, Deductions, Download Salary Slip in Excel & Word

A salary slip is a detailed document that contains the information about the salary that you receive from the organization that you work for. It also has the employment details including the name of the company, your designation, date of joining and other similar information. All organization issues pay Slip monthly, and it is shared with the employee in either a digital format or in a hard copy.

Who Gets a Salary Slip?

Like we mentioned above, any person working for an organization gets the salary slip. It is the responsibility of the employer to provide the salary slip to the employee. You may come across smaller organizations who do not provide salary slip to the employee regularly. Still, in such a case, you can request the company to issue you a salary certificate. Most of the companies have adopted a digital approach where they provide you with a digital version of salary slip.

Format of Salary Slip

The format of the salary slip can vary from one company to another. There are still some details that remain the same. You can find this information in the points below.

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Example of Salary Slip

Below is a sample of the salary slip. We have picked a template from Google, and you can search for more similar templates.

What are the Different Components of Salary Slip?

There are many different components in the salary slip. These are majorly divided into Income and Deductions. There are sub-components to these two components, and we have shared more information below. It should be noted that we have only listed a few of these components. In actual, there can be more, and they can vary from one company to another.

Income – Below are the components of the income/earnings.

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Salary Slip Deductions

Below are the components of the deductions.

What is Standard Deduction and How Does it Impacts Salary Slip?

During the union budget session of 2019-2019, the honourable Finance Minister Arun Jaitley introduced standard deductions. During the session, a standard deduction of Rs 40,000 was proposed, and the employees can claim the standard deduction. This amount was increased to Rs 50,000 in the upcoming session. The standard deduction reduces the net taxable income. The transport allowance and the medical allowance has been removed, and in return, the standard deduction has been added.

Earlier, you had to submit the medical bills and travel bills to claim the deductions in the taxable amount. Some of the companies even used to offer a reimbursement of medical allowance after you submitted the invoices. Things got easy for the employees after the introduction of the standard deductions. There is no need to provide all that documentation, and it has become effortless to claim these tax deductions.

How Can You Increase In—Hand by Just Knowing Salary Slip?

Salary slip has the details of all the components in it. It tells you about the HRA, DA, LTA and all such components that you need to be aware of to save the tax. Some of the organizations offer you an option to change the components of the salary or tweak them to maximize your salary savings. This knowledge helps you in planning your investments and expenses in a better way. You will be able to claim the deductions, and you will also be able to save yourself from paying a lot of taxes.

This way, you can choose the right set of investments for yourself. So, you can increase your monthly take away if you understand your salary slip in a better way. You must always pay attention to the various components of the salary slip to decrease your tax liability.

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What is the Difference between CTC and Fixed Compensation?

When the people join the job for the first time, they may get carried away by the CTC offered to them. When they receive their first paycheck, they get the shock of their lifetime. This shock is mainly because of the difference between the CTC and the Fixed Compensation. The CTC is the cost to the company, and it is defined as the sum of fixed pay, Pension, PF contribution and other allowances. Some of the companies may even include the employer contribution towards PF in the CTC. Whereas, the in-hand salary is what an employee receives after all the deductions. Whenever you are applying for a job, ensure that you check the difference between the CTC and in-hand. You must also check the components included in CTC. Checking this will help you in understanding what you will get every month.

What are the Taxable and Non Taxable Components of Salary Slip?

All the components are not fully taxable. Some of the components of the salary slip are non-taxable or partially taxable as well. You can check out the details below, and this will help you in maximizing the tax deductions that you claim.

Components Taxable / Non-taxable / Partially Taxable
Allowances paid to retired members of UPSC Non-taxable
Allowances paid to the government employees living abroad Non-taxable
Allowances paid to the Supreme and High Court judges Non-taxable
Allowances paid to UNO employees Non-taxable
Basic Pay Fully-taxable
CCA City Compensatory Allowance Fully Taxable
Conveyance Allowance Partially Taxable
DA – Dearness Allowance Fully-taxable
HRA – House Rent Allowance Partially Taxable
Leave Travel Allowance Partially Taxable
Meals Allowance Fully Taxable
Medical Allowance Partially Taxable
Other Allowances Fully Taxable
Performance Allowance Fully Taxable
Special Allowance Fully Taxable

By going through this table, you will also be able to tweak your salary to get the maximum deductions while filing income tax.

How to Download Salary Slip Online?

Many websites offer you with the template for the salary slip. It is effortless to create a salary slip online. Check out the steps below.

What is the Importance of Salary Slip?

There are many things that the salary slip is used for. Below are some of the points that make it one of the most important documents for you.

This was all about the salary slip. We have covered a majority of questions about the salary slip. We understand that you might have some more questions about the salary slip. You can write back to us, and we will answer those questions about the salary slip. We are sure that it will help you in better tax planning. You will pay less of tax, and you will be able to build an investment pool you’re your retirement.

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