Payroll Software for Indian Companies with PF and ESI

Direct Payroll turns a finalized attendance month into salary. HR keeps a salary structure for each employee, adds the month's incentives, arrears and recoveries as inputs, and creates the run. ZeniaHR works out paid days from attendance, splits the gross into earning heads, deducts employee PF, ESI and state professional tax, and shows the employer's PF and ESI cost. A finalized run is sealed and read-only, every employee gets a payslip PDF, and payment batches track each salary to paid.

Who uses it

HR teamKeeps salary structures current, adds monthly inputs such as incentives, arrears and advance recoveries, creates the run from the finalized attendance month and checks every line before it is sealed.

FinanceReviews gross, deductions, net pay and employer cost, finalizes and seals the run, and moves the payment batch from draft to approved to paid.

EmployeesDownload the payslip PDF for each finalized month from My Self-Service or the mobile app, with paid days, loss of pay days, earnings and deductions.

Company headSees each month's payroll cost with employer PF and ESI included, and can limit who seals runs by giving only some roles the finalize action in Access Control.

From attendance to payslip in one month

The month starts in Attendance. Once corrections are in, HR finalizes the month, which freezes every person's present days, half days, absences, leave, weekly offs, holidays and penalty days. A payroll run created after that reads the frozen figures, not live punches, so a late correction cannot quietly change a salary that has already been checked.

For each employee with an active salary structure, the run works out paid days, earns the gross for those days, splits it into Basic, HRA and the other heads your pay model uses, and deducts PF, ESI and professional tax. Earnings and deductions from the month's inputs are added on top. HR checks the draft, recomputes after any fix, and Finance finalizes it. Payslips open for download and a payment batch can be built from the sealed run.

What a finalized run guarantees

Finalizing seals the run with a SHA-256 digest of its lines. After that nothing on it can be edited or deleted. If a mistake is found, the run is cancelled, which keeps it on record with the reason, releases its inputs back to pending, and a fresh run is created. Only one regular run can exist for a month unless the earlier one is cancelled, and off-cycle and bonus runs are separate run types. This is the trail auditors and employees both ask for: what was paid, when it was sealed and by whom.

Payroll features

Payroll runsCreate regular, off-cycle and bonus payroll runs from finalized attendance, check every line in draft, then finalize and seal the run as read-only.Salary structureSet each employee's monthly gross once. ZeniaHR splits it into Basic, HRA and other heads by your pay model, keeps old structures and prorates for LOP.Payroll inputsAdd the month's overtime, incentives, bonus, arrears, reimbursements and leave encashment, or fines, advance recovery and adjustments, before the run.PF, ESI and professional taxDirect Payroll deducts employee PF, ESI and state professional tax and shows employer PF split into EPS and EPF plus employer ESI on every salary line.Loss of pay and paid daysDirect Payroll reads paid days from the finalized attendance month, applies your half-day, absence, LWP and rest-day settings, and prorates salary.PayslipsEvery finalized payroll line gets a payslip PDF with paid and LOP days, earnings, PF, ESI and professional tax, net pay in words and employer contributions.Salary payment batchesBuild a salary payment batch from a finalized run, hold employees with no bank details, approve the batch and mark it paid, with every step on record.

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Frequently asked questions

Does ZeniaHR payroll calculate PF, ESI and professional tax?

Yes. Every Direct Payroll line deducts employee PF on Basic plus DA up to the PF wage ceiling, employee ESI when the monthly wage is within the ESIC ceiling, and professional tax from the slab for the employee's state. It also shows employer PF, split into EPS and EPF, and employer ESI.

Does Direct Payroll calculate TDS on salary?

No. Direct Payroll does not compute TDS, and each payslip carries a note saying so. It covers PF, ESI and professional tax. Work out income tax on salaries with your tax adviser outside Direct Payroll, and keep the employee's PAN on the record so it prints on the payslip.

How does attendance affect salary in Direct Payroll?

Paid days come from the attendance month HR has finalized. Present days, paid leave, paid weekly offs and holidays count in full, half days count at the half-day pay percentage, and absences, leave without pay and penalty days reduce the total. Salary is then prorated over the calendar days of the month.

Can a finalized payroll run be changed?

No. A finalized run is sealed and read-only, so the numbers employees and auditors see cannot shift later. To correct it, cancel the run, which stays on record with its reason and returns its inputs to pending, fix the cause, and create a fresh run for the month.

What do I need to set up before the first payroll run?

Four things. Switch on Payroll v2, add a salary structure with the monthly gross for every employee to be paid, check the pay model and statutory settings such as the PF and ESIC ceilings and the professional tax slabs for each state, and finalize the attendance month. Then create the run and check the draft before sealing it.