How to correct/update Bank details in EPF/UAN online?

The EPFO Online member portal allows a host of services to its members to access, that range from checking their passbook, tracking their EPF fund, transferring their claim online, and a lot more. One such facility that EPF members can avail of is updating their bank details via the UAN portal.

Here are a few simple and easy steps on how to change your EPF Bank details online.

  1. Log on to the official EPFO portal.
  2. Use your UAN login id and password.
  3. Go to the menu section.
  4. Now click the “MANAGE” button.
  5. From the drop-down, click “KYC”.
  6. You will be taken to another landing page.
  7. Now select the “BANK” option.
  • You can see these options: Document Number (Bank Account Number)
  • Name as per Document (Name On Bank Account)
  • IFSC Code
  1. Fill in the required details.
  2. Press the save button.

Once you have made the changes, your online service will show KYC Pending For Approval. This means that you will have to submit the proof of your updated bank details to your employer. Once your employer approves your KYC update request, your new bank account will be added/replaced. A message regarding this will also be conveyed through your registered mobile number.

Wealthcafe Advice:

You are no longer dependent on your employer or your ex-employer to update the details or exit date on the EPFO portal. Linking your Aadhar is mandatory as well as it is crucial to mark your date of exit correctly. Follow the simple steps stated above and you will be able to update your EPF account easily.

 

Uncategorized - 10/29/2021

All You Need to Know About Salary Slips/Payslips

Whether it’s your first payslip or if you’ve been working for years, it’s still important to know how your pay is worked out. Your payslip contains important information, including your payroll number, your gross and net pay, and normally your tax code. It’s important to understand your payslip and how to make sure you’re being paid the right amount.

All employees and workers are entitled to an individual, detailed written payslip – when, or before, they’re paid.

Your written payslip doesn’t have to be on paper – it can be sent to you by email or accessed through a website.

The right to a payslip applies to casual staff as well as employees. It doesn’t apply to independent contractors or people working freelance.

 

Importance of Salary Slip

  • The salary slips act as evidence of employment.
  • It proves that the organization has permanently recruited an employee.
  • This is handy in negotiating with new employers for better pay.
  • Salary slips aid to apply for loans in banks.
  • It is an authentic proof of income and is used to file income tax returns.
  • It serves as proof for PF and insurance deductions.

All employees must receive payslips on a monthly basis as it is the proof of their employment in an organization and is required for various compliance filings like income tax filing and PF return filing. If an employee has not received it, he/she could speak with their payroll team to have it sent automatically post payroll processing.

What are E-Payslips?

In the current technologically advanced times, most employers prefer to make the payslips available online. This digital, online payslip is known as an e-payslip. You can easily view and download the salary slip by logging into your organization’s salary portal.

Components of a Salary Slip

The components are sub-divided into 2 sides which are as follows.

  1. Income or earnings (LHS of your salary slip)
  2. Deductions (RHS of your salary slip)

We look into the various components of a salary slip in the paragraphs below:

Income:

All the income and gains such as your basic salary, allowances, reimbursements, etc are allocated on the left-hand side of the payslip. 

Deductions:

All deductions such as EPF, Professional Tax, TDS, etc are located on the right side of the payslip.

Payslip Format

What is a Salary Slip used for?

If you study the payslip format, you will find that there are many components listed on it. Downloading and understanding each of these components can prove to be very helpful. Listed below are some of the uses of a salary slip.

Maximize Income Tax Savings

Thorough knowledge of the basic pay, house rent allowance, tax deductions, etc., can help you with your income tax planning so that you can maximize savings. For example, under Section 10 of the Income Tax Act, 1961, if you live in rented accommodation, you can claim a part of the House Rent Allowance (HRA) under tax deduction. Also, under Section 80C of the same Act, you can enjoy tax savings against EPF (Employees’ Provident Fund) contribution, which makes up to 12 percent of your basic salary.

To Apply for a Credit Card

You need the monthly salary payment slip even when you apply for a credit card. The document serves as proof of your regularised income and backs your eligibility for the selected credit card.

Prove Employment Status

Your payslip is legal proof of your employment status. If you are looking to get a loan, open a bank account, apply for a visa, etc., you would need to submit copies of your salary slips for the last three months as proof of your last drawn salary.

Resolve Discrepancies in Salary Payment

If you see a change (increase/ decrease) in your monthly salary amount, you can refer to your payslip and check the deductions. In case of discrepancies, you can use the payslip as proof and raise the issue with the finance team of your organization.

For Switching Jobs

When you are looking to seek employment in a different organization, you would need to provide your salary slip to the employer to initiate salary negotiations. This is because your new salary is decided based on your current salary.

Wealth Cafe Learning:

A payslip or salary slip to an employee is the amount of money paid by the employer to you for the month. It contains all of the details mentioning how the salary was calculated and sent to you. We hope you've understood everything about salary slips. 

If you have any queries on your salary slip, do ask in the comments section below.

Uncategorized - 10/29/2021

CTC components

Many a time, the terms like CTC derive a big question mark as to its understanding. Every individual has to find their way through such a dilemma, considering he/she is working in the corporate sector. We, in order to simplify the basic salary structure, have prepared an in-depth article into the world of COST TO COMPANY.

What is CTC?

CTC or Cost to Company is the total amount that a company spends (directly or indirectly) on an employee. It refers to the total salary package of the employee. CTC is inclusive of monthly components such as basic pay, various allowances, reimbursements, etc., and annual components such as gratuity, annual variable pay, annual bonus, etc.

CTC is never equal to the amount of take-home salary of the employee. There are many components in the CTC that one does not receive as part of take-home salary.

CTC = Direct Benefits + Indirect Benefits + Savings Contributions

Fixed Components Variable Components

(Savings & Contribution)
Direct Benefits Indirect Benefits
Basic Salary Interest- Free Loans Employer Provident Fund (EPF)
Dearness Allowance (DA) Food Coupons/Subsidized meals Gratuity
Conveyance Allowance Company Leased Accommodation Performance Variable Bonus 
House Rent Allowance (HRA) Medical and Life Insurance premiums paid by the employer ESOPs/RSUs
Special Allowance Income Tax Savings
Leave Travel Allowance (LTA) Office Space Rent
Vehicle Allowance Medical/Health Insurance 
Telephone/ Mobile Phone Allowance

Let us now discuss common CTC components:

  1. Basic salary

The first and most important part of the CTC is the basic salary. This is the amount that is payable to the employees for their services to the organization. It forms a part of their take-home salary and is subject to income tax.

Usually, employers make sure that the basic salary does not constitute more than 40% of the overall CTC.

  1. Allowances

The next component of the CTC is allowances. Allowances are all the perks and benefits (direct and indirect) that the company offers to the employee. These allowances are

All these allowances forming a part of the CTC are subject to different income tax rules. In India, the Income Tax Act lays down the rules for the taxation of these allowances.

  1. Reimbursements

Occasionally, employees are entitled to several reimbursements like medical treatments, phone bills, newspaper bills, etc. The amount is not received in the salary, but on submission of the bills, reimbursement is given. Generally, there is an upper limit for every category of reimbursement.

  1. EPF

EPF is an investment scheme whereby both employer and employee contribute a certain sum of money to the employee’s benefit. This amount is accessible only after the retirement of a person.

Two cases lie under this:-

– If the basic salary of the employee is less than Rs.15,000, then the employer contributes 12% of the basic pay.

– If the basic salary is more than Rs.15,000, then it is up to the discretion of the employer on how much to contribute. In this case, the employer can contribute 12% of the basic pay or 12% of 15,000 which is Rs.1800.

Thus, both parties are supposed to contribute 12% of the set amount in the Employee’s Provident Fund account. It is mandatory for Indian Registered Companies to make such contributions.

  1. Gratuity

Gratuity is the part of the salary that is received by an employee from the employer for the services offered by the employee upon him or her leaving the job.

Though an employee can receive the gratuity amount only after 5 years, it will be deducted by the employer every year and hence it will get deducted from your CTC.

  1. ESOP

An employee stock ownership plan (ESOP) is a type of employee benefit plan which is intended to encourage employees to acquire stocks or ownership in the company.

These plans are aimed at improving the performance of the company and increasing the value of the shares by involving stockholders, who are also the employees, in the working of the company. The ESOPs help in minimizing problems related to incentives.

Therefore, It clearly means that CTC is not only the salary, but it also includes many additional benefits. It contains all monetary and non-monetary amounts spent on an employee. 

Uncategorized - 10/29/2021

What is an offer letter? What is included in it?

Receiving an offer letter from an employer or recruiter is an exciting time. It means your skills and experience are valuable and the company wants to hire you. In this article, we'll go over what is a job offer letter, along with typically what's included in it.

What is an offer letter?

An offer letter is a written document that offers a candidate a particular job position for which he/she was interviewed and got selected. It is created to intimate the candidate about his/her employment. It contains the Job title, joining date, finalized package or salary, Reporting manager’s details, role and responsibilities, and other benefits he/she is eligible for.

Once the offer letter is handed over to the candidate, he/she needs to accept to proceed with the hiring process further. The offer letter acceptance can be done verbally or in writing. Basically, It is a documented formality to offer a job and accept the same.

What's Included in a Job Offer Letter

An offer letter confirms employment details such as:

  • Job description: A description of what your overall goals are along with your day-to-day tasks
  • Job title: What your title will be when working at this company
  • Reporting structure: Another item discussed during the interview process, the reporting structure is often included in job offer letters. The reporting structure will detail who you report to, along with who will be reporting to you.
  • Work schedule: The hours you are expected to work each week. The job offer letter should also include your expected start date, which was likely discussed during the hiring process.
  • Salary: The amount you can expect to make on a yearly basis. Also included should be any bonuses or commissions that go along with the job.
  • Benefits information and eligibility: Most full-time jobs come with a benefits package. Your letter will likely include information about this package, including healthcare and retirement benefits.
  • Termination conditions: The job offer letter may detail the conditions that would lead to your termination. This is another important thing to have in writing in case there is a dispute somewhere in the future.
  • Finally, Acknowledgment of offer and confirmation of acceptance

Is a letter of offer a binding contract?

Whether or not a job offer is a binding contract depends on a few things. Technically, they’re all binding contracts, but it’s the terms of the contract that dictate just how binding it is. Most job offer letters will include a formal start date but say nothing about the term of employment (aka the end of it). Instead, there is often a clause describing the employment as an “at-will” contract, which means that either party can terminate it as long as the terms of termination are met (this is where the amount of time necessary for giving notice and the like are taken care of).

Therefore, the job offer letter is important because it relays vital information in writing. If there are any discrepancies after you've begun working, you'll want to have a written record of what you were expecting.

Wealth Cafe Learnings

A job offer letter allows to itemize the facts about the offer, outline the job’s responsibilities and highlight relevant details about the company. If you accept the offer, the letter serves to promote communication and to help orient you to the business environment before they actually start their first day of work.

 

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    Uncategorized - 10/29/2021

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