Go AD-Free with CAclubindia Pro and Daily Mobile Updates. Subscribe Now!

Courses :
Live
Fake ITC
View All

How do we Treat Employer NPS in a CTC Structure or in a payslip.

Deepak Kumar Mahapatra (1 Points)

21 August 2024

We are introducing Employer NPS in our organisation. and wanted to know how we can treat NPS in a Compensation Structure and Also payslip.

Reply
Follow
Share

3 Replies

Rama chary Rachakonda (Master in Accounts & high court Advocate) (8573 Points)
Replied 22 August 2024

NPS (National Pension System) is a retirement savings scheme in India. When including NPS in a compensation structure and payslip, consider the following: Compensation Structure: 1. *Basic Salary*: NPS contribution can be a percentage of basic salary. 2. *Allowances*: Some companies include NPS contribution as an allowance. 3. *Deductions*: NPS contribution can be deducted from the employee's salary. Payslip: 1. *Gross Salary*: Show the employee's gross salary before NPS deduction. 2. *NPS Contribution*: Display the employee's NPS contribution (both employee and employer contributions). 3. *Net Salary*: Show the net salary after NPS deduction. 4. *Break-up*: Provide a break-up of the NPS contribution, including the employee and employer shares. Tax Implications: 1. *Employee Contribution*: Allowable as a tax deduction under Section 80CCD(1) up to ₹1.50 lakh. 2. *Employer Contribution*: Exempt from tax as a perquisite under Section 10(12A). Reporting: 1. *Form 16*: Include NPS contribution in Form 16 (TDS certificate). 2. *Form 24Q*: Report NPS contribution in Form 24Q (TDS return). Please consult a tax professional or HR expert to ensure compliance with relevant laws and regulations.

Rama chary Rachakonda (Master in Accounts & high court Advocate) (8573 Points)
Replied 22 August 2024

NPS (National Pension System) is a retirement savings scheme in India. When including NPS in a compensation structure and payslip, consider the following: Compensation Structure: 1. *Basic Salary*: NPS contribution can be a percentage of basic salary. 2. *Allowances*: Some companies include NPS contribution as an allowance. 3. *Deductions*: NPS contribution can be deducted from the employee's salary. Payslip: 1. *Gross Salary*: Show the employee's gross salary before NPS deduction. 2. *NPS Contribution*: Display the employee's NPS contribution (both employee and employer contributions). 3. *Net Salary*: Show the net salary after NPS deduction. 4. *Break-up*: Provide a break-up of the NPS contribution, including the employee and employer shares. Tax Implications: 1. *Employee Contribution*: Allowable as a tax deduction under Section 80CCD(1) up to ₹1.50 lakh. 2. *Employer Contribution*: Exempt from tax as a perquisite under Section 10(12A). Reporting: 1. *Form 16*: Include NPS contribution in Form 16 (TDS certificate). 2. *Form 24Q*: Report NPS contribution in Form 24Q (TDS return). Please consult a tax professional or HR expert to ensure compliance with relevant laws and regulations.

Rama chary Rachakonda (Master in Accounts & high court Advocate) (8573 Points)
Replied 22 August 2024

NPS (National Pension System) is a retirement savings scheme in India. When including NPS in a compensation structure and payslip, consider the following: Compensation Structure: 1. *Basic Salary*: NPS contribution can be a percentage of basic salary. 2. *Allowances*: Some companies include NPS contribution as an allowance. 3. *Deductions*: NPS contribution can be deducted from the employee's salary. Payslip: 1. *Gross Salary*: Show the employee's gross salary before NPS deduction. 2. *NPS Contribution*: Display the employee's NPS contribution (both employee and employer contributions). 3. *Net Salary*: Show the net salary after NPS deduction. 4. *Break-up*: Provide a break-up of the NPS contribution, including the employee and employer shares. Tax Implications: 1. *Employee Contribution*: Allowable as a tax deduction under Section 80CCD(1) up to ₹1.50 lakh. 2. *Employer Contribution*: Exempt from tax as a perquisite under Section 10(12A). Reporting: 1. *Form 16*: Include NPS contribution in Form 16 (TDS certificate). 2. *Form 24Q*: Report NPS contribution in Form 24Q (TDS return). Please consult a tax professional or HR expert to ensure compliance with relevant laws and regulations.

CCI Pro

Recent Topics

More recent discussions | Post

Related Threads

Popular Discussion

Start a New Discussion

CCI Pro

Meet our PRO Members

michael dcosta

PRO MEMBER

Deepak Soni

PRO MEMBER

rupendra

PRO MEMBER

Prince Joseph

PRO MEMBER

THOMAS JOHN

PRO MEMBER

Subscribe to CAclubIndia Pro

Trending Online Classes

GST Demands and Recoveries: Navigating Through the Tides

CA Nipun Arora

Enroll Now

17 July 2025
Fake ITC & Penalties under GST Act - Patanjali Ayurveda Case

CA Shruti Singhal

Enroll Now

25 July 2025
Certification Course on GSTR-3B Reconciliation with GSTR-2B through AI Tools

CA Deepak Gupta

Enroll Now

15 July 2025

view all classess

Follow us

Subscribe to the latest topics :

Search Forum:

Forum Home

Popular Threads

Recent Posts

Unreplied Threads

Settings