Statutory Compliances for India

Companies are accountable for effecting deductions on account of EPF, ESI, Professional Tax, Income Tax and Labor Welfare Fund from the employees' earnings. This is based on the prevailing rules and deposit of the same with the respective agencies within a specific time frame. Apart from this, the payroll processor has to prepare returns and reports and submit the same on a monthly, quarterly, half-yearly or annual basis as specified by the concerned agencies. There are five very important statutory compliance commitments as far as payroll is concerned.

HR has to ensure that the organization complies with all the relevant laws of the state and the country. The various statutory compliance activities are given below.

• Ensure all relevant employee and labor related licenses and permissions are obtained.
• Onboard all current and new employees into various schemes as applicable to the organization.
• Perform an accurate Payroll Calculation for making various deductions, from the employee's salary, based on the applicable laws.
• Ensure timely reports are submitted to the relevant authorities as per the mandated schedule. Report submission may be online or through the filing of hard copy.
• Ensure that all relevant statutory forms and certificates are issued when an employee leaves the organization.
• Some of the most common statutory requirements that HR needs to handle include PF, ESI and Income Tax. Apart from these, there are state-specific laws in the areas of Factories Act, Shops and Establishments Act and Professional Tax.

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