TallyPrime Course

A payroll voucher is used to record all employee-related transactions. It enables you to compute all the values for the respective Pay Heads (Earnings and Deductions). It allows you to document and track the financial transactions associated with payroll processing within your organization. This voucher may be used in two ways – Manual Entry and Automated Entry   Employee Information  Name Salary Slip Payroll Voucher Type Creation Select type of Voucher Payroll Name Of Class Pay Slip   Class Pay Slip  

It encompasses the various components and elements that make up an employee’s earnings, including basic salary, allowances, incentives, bonuses, and other salary-related components. These components are known as “pay heads” in Tally Prime. Each pay head represents a specific earning or deduction related to an employee’s salary. Gateway Of Tally >> Alter >> Define Salary   Select Employee   Setting up salaries in Tally Prime’s payroll module, you typically define the components that constitute an employee’s salary.   2 Select Employee   Define Salary Components  

Pay heads refer to the specific components or elements that make up an employee’s salary or wages. Which represent the various earnings, deductions, or contributions that are included in an employee’s payroll calculation.   Types Of Pay Head A Pay Head is categorized as Allowances, Deductions or Reimbursements, In Tally Payroll, Pay Head types are provided in a natural language for ease of use, as follows: Earning for Employees Deduction from Employees Employer’s Statutory deductions Employer’s Statutory Contribution Gratuity Loans and Advances Reimbursement to Employees   Earnings Pay Heads These pay heads represent the components that contribute to an employee’s earnings. They include salary components such as Basic Salary, Allowances, Overtime Pay, Bonus, Incentives, and any other income-related elements. Some examples of Earnings Pay Heads Basic Salary, Dearness Allowance City Compensatory Allowance, House Rent Allowance, Night Shift Allowance, Uniform Allowance, Sales Commission   Deductions Pay Heads These pay heads represent the components that are deducted from an employee’s salary or wages. They include deductions such as Provident Fund (PF) contributions, Tax Deducted at Source (TDS), Insurance Premiums, Loan Repayments, and any other deductions applicable to the employee. Some examples of Deductions pay heads Employees’ Provident Fund (EPF) Employees’ State Insurance (ESI) Professional Tax Income Tax TDS Advance (if any)   Salary Earning / Deduction Calculation Types The Calculation of the Pay Head is bases on its Calculation Type. Tally payroll allows following calculation methods As Flat Rate On Production As Computed Value As User defined Value   1. As Flat Rate : As Flat Rate is a Calculation where the value of the Payroll head is a fixed amount for a period. Pro-rated. In Tally the attendance can be of Payable days (Present) or loss of pay (Absent) type.   2. On Production : On production calculation type is used to calculate the Production incentive type of Pay head. The production date can be entered in Attendance voucher against a Production type.   3. As Computed Value : As Computed Value is used if the Pay Head value is based on a dependent component. You will be able to define the dependent component by specifying the formula or using the current sub- total or current earning or deduction total. You can also define the slab either by percentage to value or the combination in a slab. i.e. HRA as 40% of Basic Salary   4. As User defined Value : As User defined Value allows you to manually enter the value at the time of processing the salary. This calculation type is useful for Pay Heads that have variable values and are not related to any attendance/production data.   Note: The formula defined in Calculation Type will be used for computation only while using Payroll Auto Fill functionality in the Payroll Voucher, and not in Manual entry mode of Payroll voucher. Pay Head Creation in Tally   Pay Head Creation in Tally (Basic Salary)   Pay Head Creation in Tally (Overtime)   Pay Head Creation in Tally (Absent)   Pay Head Creation in Tally (Bonus)   Pay Head Creation in Tally (ESI)   Pay Head Creation in Tally (PF)  

The payroll work unit refers to the basic unit of measurement used for calculating wages or salaries of employees,  It is typically an hour, day, week, or month, depending on the organization’s payroll policies. A unit is used to define the quantity or rate of an employee’s earnings or deductions. Payroll work units can be classified into two types, Simple Payroll Units and Compound Payroll Units.  1 Simple Payroll Units refer to individual units such as Day, Week, Month, Hours, Pcs, Box, Nos etc., Whereas, 2 Compound Payroll Units refer to Units which are combination of two simple units, i.e., an Hour of 60 Minutes, Month of 26 days, Day of 8 Hrs. 1. Hourly-based payroll: In hourly-based payroll, the number of hours worked is used as the unit of calculation. The employee’s hourly rate is multiplied by the number of hours worked to determine the gross pay. 2. Commission-based payroll: In commission-based payroll, the amount of sales made is used as the unit of calculation. The employee’s commission rate is multiplied by the total sales to determine the commission amount. 3. Deductions: Units can also be used to calculate deductions such as taxes, insurance, and retirement contributions. The amount of the deduction is based on the percentage of the employee’s gross pay, and the unit used is the gross pay.   Create Payroll Work Unit?      

Payroll Attendance refers to the recording and management of employee attendance data within the payroll module. It involves tracking and maintaining records of employee presence, absence, leaves, half-days, and other attendance-related information. The Payroll Attendance functionality in Tally Prime allows you to accurately calculate employee wages or salaries based on the recorded attendance data. Employee :- Ramesh Absent :- 2 Day Overtime :- 2 HRS   Employee :- Suresh Absent :- 1 Day Overtime :- 3 HRS  

Businesses with multiple departments, divisions, functions or activities may create the required employee groups and classify individual employees under a specified group i.e. Production Sales Marketing Stores An Employee Group allows you to group employees in a logical manner, the Salary structure can be defined at the Employee Group level   How to Create employee Group?   Gateway Of Tally >> Create >> Employee Group Enter the Name of the Employee group. Select the group from the List of Employee Groups. Accept to save the Employee Group. You can create multiple Employee Groups in this mode. Here created two employee Purchase Sale Employee Group Creation (Sales)   Employee Group Creation (Purchase)  

Payroll is one of the most critical components of Human Resource Management (HRM). It refers to the process of calculating and distributing wages and salaries to employees for their work during a specific period. A Payroll Master is a comprehensive system or database that stores all the necessary employee-related information required for salary calculation. Once you have set up the Payroll Master, you can use it to generate employee pay slips, calculate salaries, deductions, and taxes. You can also use it to generate reports related to employee payroll, such as the Payroll Statement, Attendance Report, and Salary Register.   Objectives of Payroll Master Maintain accurate employee salary records. Automate monthly salary calculations. Comply with statutory laws (PF, ESI, TDS, etc.). Generate payslips, reports, and salary registers. Avoid errors and delays in salary disbursement. Employee Details Employee ID Name Department Designation Date of Joining Bank Details PAN and Aadhaar Number Salary Structure Basic Salary House Rent Allowance (HRA) Dearness Allowance (DA) Conveyance Allowance Medical Allowance Special Allowance Deductions Provident Fund (PF) Employees’ State Insurance (ESI) Tax Deducted at Source (TDS) Professional Tax (if applicable) Loan/Advance Repayments Absence/Loss of Pay (LOP) Gross and Net Salary Gross Salary = Total Earnings before deductions Total Deductions = Sum of all deductions Net Salary (Take-Home Pay) = Gross Salary – Deductions   Salary Calculation Formulae Basic Salary = 40% to 50% of Gross Salary HRA = 40% (Non-Metro) or 50% (Metro) of Basic Salary Employee Contribution = 12% of Basic Salary Employer Contribution = 12% of Basic Salary (split into 8.33% to Pension + 3.67% to PF) Employee Contribution = 0.75% of Gross Salary Employer Contribution = 3.25% of Gross Salary (only if Gross Salary ≤ ₹21,000) Calculated as per Income Tax Slabs   Employee Salary Calculation Employee Details: Name: Ankit Sharma Department: Marketing Designation: Marketing Executive Gross Monthly Salary: ₹40,000 Basic Salary: ₹16,000 (40% of Gross) HRA: ₹8,000 (50% of Basic) Conveyance Allowance: ₹2,000 Medical Allowance: ₹1,250 Special Allowance: ₹12,750 Earnings: Component Amount (₹) Basic Salary 16,000 HRA 8,000 Conveyance Allowance 2,000 Medical Allowance 1,250 Special Allowance 12,750 Gross Salary 40,000 Deductions: Component Amount (₹) PF (Employee) 1,920 (12% of Basic) ESI (Employee) 300 (0.75% of Gross) TDS 1,500 (Example) Total Deductions 3,720 Net Salary: Net Salary = Gross – Deductions = ₹40,000 – ₹3,720 = ₹36,280 Example A company with 5 employees needs to process salary for May 2025. Each has different salary structures and deductions. Name Gross Salary Basic HRA Convey. PF (12%) TDS Net Salary Ankit ₹40,000 ₹16,000 ₹8,000 ₹2,000 ₹1,920 ₹1,500 ₹36,280 Priya ₹35,000 ₹14,000 ₹7,000 ₹2,000 ₹1,680 ₹1,200 ₹31,620 Rahul ₹30,000 ₹12,000 ₹6,000 ₹2,000 ₹1,440 ₹1,000 ₹27,560 Sneha ₹25,000 ₹10,000 ₹5,000 ₹2,000 ₹1,200 ₹800 ₹23,000 Karan ₹20,000 ₹8,000 ₹4,000 ₹2,000 ₹960 ₹500 ₹18,540 This case demonstrates how Payroll Master automates salary processing, reduces errors, and generates reports efficiently.