Salary Components

Components are the building blocks of any salary. Before you can build a salary structure or run payroll, you need to define every earning and deduction item your organization uses.

Once created, a component can be reused across multiple Pay Groups and employees. You only define it once.

Navigate to Payroll → Settings → Components to manage them.

Component Tabs

The Components screen is split into four tabs:

Tab	What it contains
Earnings	All positive pay items — Basic Pay, HRA, Special Allowance, Travel Allowance, Bonus, etc.
Benefits	Employer-provided benefit components — Medical Allowance, LTA, Gratuity, etc.
Deductions	Amounts subtracted from salary — Provident Fund, Employee State Insurance, Professional Tax, Labour Welfare Fund, Tax Deducted at Source, and others.
Reimbursements	Expense reimbursements paid alongside salary — Fuel, Internet, Mobile, etc.

NOTE

Some standard components — such as Basic, House Rent Allowance (HRA), Provident Fund (PF), Employee State Insurance (ESI), Professional Tax (PT), Labour Welfare Fund (LWF), and Tax Deducted at Source (TDS) — are already available in your account. Their core settings are fixed, but you can configure how they are calculated when you attach them to a Pay Group.

Pre-configured Components

Your account comes with a set of standard components already created. These cover the most common earnings and deductions so you can get started quickly without having to build everything from scratch.

Pre-configured components:

• Are already available in your Components list
• Cannot be deleted
• Have fixed calculation rules

Default Earnings

Some are active by default, others can be activated when required:

• Basic
• House Rent Allowance (HRA)
• Conveyance Allowance
• Fixed Allowance
• Special Allowance
• Bonus
• Commission
• Leave Encashment
• Gratuity
• Overtime Allowance
• Notice Pay
• Hold Salary

Default Benefits

• Voluntary Provident Fund (VPF)

Default Deductions

Component	Full Name	Frequency
Withheld Salary	Withheld Salary	One-time
Loss of Pay	Loss of Pay	One-time
TDS	Tax Deducted at Source	Recurring
PF	Provident Fund	Recurring
LWF	Labour Welfare Fund	Recurring
PT	Professional Tax	Recurring
ESI	Employee State Insurance	Recurring

NOTE

You do not need to create the statutory deductions (Tax Deducted at Source, Provident Fund, Labour Welfare Fund, Professional Tax, Employee State Insurance) manually — they are already available in your account. Their rates and applicability are configured when you attach them to a Pay Group.

Default Reimbursements

• Fuel Reimbursement
• Driver Reimbursement
• Telephone Reimbursement
• Leave Travel Allowance
• Vehicle Maintenance Reimbursement

Adding an Earning Component

1. Navigate to Payroll → Settings → Components. Click the Earnings tab.
2. Click Add Earning Component. A side panel slides in.
3. Select the Earning Type from the dropdown (e.g., Basic, HRA, Special Allowance). This field is locked after saving.
4. Enter the Earning Name (internal name) and Name in Pay Slip (label shown on the employee's payslip).
5. Add an optional Description, or click the AI icon to generate one based on the name.
6. Set the Calculation Type — Flat (fixed amount) or Percentage (percentage of another component).
   • If Flat: enter the amount.
   • If Percentage: select the base (Basic, Gross, CTC, etc.) and enter the percentage value.
7. Configure the toggles and checkboxes (see field reference below).
8. Check Mark as Active to make the component available for use.
9. Click Save.

TIP

When you select Special Allowance as the earning type, the calculation type selector is hidden. Special Allowance is auto-derived as: Monthly CTC minus the sum of all other components. This ensures the salary always adds up to the CTC exactly. Always include Special Allowance in every salary structure.

Earning Component Field Reference

Field	Required	Description
Earning Type	Yes	The category this earning belongs to. Locked after first save.
Earning Name	Yes	Internal name used for identification. Not shown on payslips.
Name in Pay Slip	Yes	The label printed on the employee's payslip.
Description	No	Optional description. Supports AI-assisted generation.
Calculation Type	Yes	Flat — a fixed amount. Percentage — a percentage of another base component.
Mark as Active	—	Inactive components are hidden when building salary structures.
Include in CTC	—	When checked, this component is counted as part of the employee's Cost to Company.
Taxable	—	Marks the earning as taxable income, included in TDS calculations.
Pro Rata / Proration	—	When enabled, the component is calculated proportionally based on working days. Useful for mid-month joiners or LOP.
Consider for EPF Contribution	—	Includes this earning in the PF wage base for EPF calculation.
Consider for ESI Contribution	—	Counts this earning in the ESI gross salary for ESI deduction computation.

WARNING

If Include in CTC is disabled for a component, it will not be distributed when you enter an employee's annual CTC. It must be set as a flat amount separately.

Adding a Deduction Component

1. Navigate to Payroll → Settings → Components. Click the Deductions tab.
2. Click Add Deduction Component. The side panel opens.
3. Enter the Name in Pay Slip (the label shown on the employee's payslip).
4. Add an optional Description.
5. Set the Deduction Frequency — One-time (deducted in a single pay run) or Recurring (deducted every pay period until a configured end condition).
6. Click Save.

Deduction Component Field Reference

Field	Required	Description
Name in Pay Slip	Yes	Label displayed on the employee payslip.
Description	No	Internal notes about what this deduction covers.
Deduction Frequency	Yes	One-time — deducted in a single pay run. Recurring — deducted every pay period until the total amount is repaid or an end date is reached.

Editing a Component

1. Find the component in the appropriate tab list.
2. Click the icon in the Actions column. The side panel reopens with saved values.
3. Modify the fields and click Save.

WARNING

Editing a component after it has been included in a completed pay run may cause discrepancies between historical payslips and the current configuration. Make component edits before the next pay run, not after.

Deleting a Component

1. Find the component in the list.
2. Click the icon in the Actions column.
3. Confirm the deletion in the dialog.

WARNING

Deleting a component that is currently in use on any salary structure or active Pay Group will break those configurations. Instead of deleting, consider unchecking Mark as Active to hide the component without erasing it. Historical payslips reference component names — deleting a used component can corrupt the display of old payslips.

Important Rules

• Pre-configured standard components cannot be deleted.
• A component that is already in use by a Pay Group cannot be deleted.
• The Earning Type field is locked after a component is saved and cannot be changed later.
• If you no longer need a component, deactivate it instead of deleting it — this preserves the record on historical payslips.

Best Practices

• Set up all your components first, before creating Pay Groups. You will need to select components when configuring a Pay Group.
• Always include Special Allowance as the last earning component in every salary structure.
• Do not change the calculation settings of statutory components (PF, ESI, TDS) unless you are certain of the updated rules.
• Only activate the components your organization actually uses — this keeps the list clean and avoids confusion when building salary structures.

Related Setup

• Pay Group Configuration — attach components to a Pay Group
• Pay Groups — configure payroll rules

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