Salary Slip Format: How to Make a Payslip for Employees (India)

If you run a small shop, clinic, agency or startup in India, sooner or later an employee will ask for a salary slip. They may need it for a home loan, a credit card, a rental agreement, a visa file or simply to understand where their money goes each month. Large companies have payroll software for this. Small employers usually end up copying an old Excel sheet, changing a few numbers and hoping nothing breaks.

This guide explains what a salary slip should contain, how to calculate each line, a worked example you can follow, and how to produce a clean PDF payslip in a few minutes with a free online tool.

What is a salary slip and why it matters

A salary slip (also called a payslip or pay stub) is a monthly statement from the employer that shows:

• what the employee earned in that month (the earnings or gross salary),
• what was deducted (provident fund, professional tax, income tax and so on), and
• what was actually paid into their account (net pay or take-home salary).

For the employee, the slip is proof of income. Banks and NBFCs commonly ask for the last three to six months of slips with a loan application, and landlords or embassies may ask for them too. For the employer, a consistent slip every month is a simple record that salary was calculated and paid properly, which helps when there is a dispute, an audit or a question from an accountant.

What to include in a salary slip format

A good payslip is easy to read in ten seconds. Most Indian formats follow the same layout:

1. Header

• Company name, address and logo (if you have one)
• Title: "Salary Slip for the month of October 2026"

2. Employee details

• Employee name and employee ID
• Designation and department
• Date of joining
• PAN, UAN (PF account number) and bank account last digits, where applicable
• Paid days and loss-of-pay (LOP) days for the month

3. Earnings (left column)

• Basic salary
• House Rent Allowance (HRA)
• Dearness Allowance (DA), if your company pays it
• Conveyance or travel allowance
• Special allowance or other allowances
• Overtime, bonus or incentive, if paid this month

4. Deductions (right column)

• Employee Provident Fund (PF) contribution
• Employee State Insurance (ESI), where applicable
• Professional tax (state-specific)
• Income tax deducted at source (TDS)
• Salary advance or loan recovery

5. Totals

• Gross earnings
• Total deductions
• Net pay in figures and in words

6. Footer

• A line such as "This is a computer-generated payslip" or an authorised signature and company stamp

Keep the order the same every month. Consistency is what makes a payslip look trustworthy to a bank officer.

How to calculate each component

The structure of a salary is decided by the employer, usually in the offer letter. The payslip simply applies that structure to the month.

Basic salary is the fixed core of the salary. Many other components, such as PF and sometimes HRA, are calculated on basic, so get this number right first.

HRA is usually fixed as a percentage of basic or as a flat amount in the offer letter. Whatever you agreed, use the same figure every month.

Allowances like conveyance and special allowance are typically flat amounts. The special allowance is often the "balancing figure" that makes the monthly gross match the agreed CTC.

Loss of pay. If an employee has unpaid leave, reduce the earnings in proportion: monthly amount × paid days ÷ total days in the month. Show the paid days on the slip so the employee can see why the amount changed.

Provident fund. For establishments covered by EPF, the employee contribution is commonly 12% of basic wages (plus DA), and the employer contributes separately. Wage ceilings and optional rules apply, so check the latest EPFO rules for your case.

ESI applies only to employees whose wages are below the ESIC wage limit and only if your business is covered. Check the current threshold and rates on the official ESIC website before you deduct.

Professional tax is levied by some states and not others, and the slabs differ by state. Look up your state's latest schedule.

TDS depends on the employee's expected annual income, the tax regime they choose and the declarations they submit. If you are unsure, ask your accountant; do not guess.

A worked example

Let us build a simple monthly slip for an employee called Priya, who works in an office in Pune. The figures below are only for illustration.

| Earnings | Amount (₹) | Deductions | Amount (₹) | |---|---|---|---| | Basic salary | 15,000 | Provident fund (12% of basic) | 1,800 | | HRA | 6,000 | Professional tax | 200 | | Conveyance allowance | 1,600 | TDS | 0 | | Special allowance | 4,000 | | | | Gross earnings | 26,600 | Total deductions | 2,000 |

Net pay = 26,600 − 2,000 = ₹24,600

Net pay in words: Rupees Twenty-Four Thousand Six Hundred Only

Now suppose Priya took two days of unpaid leave in a 31-day month. Her paid days are 29, so each earning is multiplied by 29/31. Basic becomes about ₹14,032, HRA about ₹5,613 and so on. PF is then calculated on the reduced basic. This is exactly where manual Excel sheets go wrong, because one formula is updated and another is not.

Writing the net amount in words is a small detail that many small businesses skip, yet banks often look for it. If you are not sure how to write a figure in the Indian lakh-crore style, paste it into the Number to Words Converter and copy the result.

Create a payslip online in 5 minutes

Instead of rebuilding a spreadsheet every month, you can use the free Payslip Generator on Doffl. It is designed around Indian salary components and runs in your browser.

1. Enter company details – company name and address.
2. Enter employee details – name, ID, designation, month and paid days.
3. Add earnings – basic, HRA, DA, conveyance, special allowance or any custom line.
4. Add deductions – PF, ESI, professional tax, TDS or advance recovery.
5. Check the preview – the tool adds up gross earnings, total deductions and net pay for you.
6. Download the PDF – save it, email it to the employee or print it.

Tip: save the values you used for each employee in a simple note or sheet. Next month you only change the month, the paid days and any variable pay.

If you want the slip to carry your company seal, you can design one with the Digital Stamp Creator and place it near the signature line of the printed or PDF slip.

Common mistakes to avoid

• Gross and net that do not add up. Always check: gross − total deductions = net pay. Banks notice arithmetic errors.
• Changing the format every month. Use the same layout, the same component names and the same order.
• Missing paid days. If salary changes because of leave, the slip should show why.
• Deducting ESI or professional tax where it does not apply. Both depend on wage limits and your state; check the official rules first.
• Wrong month or year in the title. A slip for "September" with October dates is a red flag in a loan file.
• No net pay in words. It takes a few seconds and makes the document look complete.
• Issuing fake or inflated slips. A payslip must reflect the salary actually paid. Creating false income documents for a loan or visa can have serious legal consequences.

Planning salaries before you issue slips

If you are hiring for the first time or revising pay, it helps to plan the total monthly salary cost before you fix the structure. The Salary Budget Calculator lets you add up salaries across your team so you know what you can afford each month. Once the budget is fixed, put the agreed structure in the offer letter and use the same components on every payslip.

Conclusion

A salary slip does not need expensive payroll software. It needs the right components, correct arithmetic and the same clean format every month. Fix each employee's salary structure once, apply paid days carefully, check statutory deductions against the latest official rules, and generate the slip as a PDF. With the free Payslip Generator, a small business can issue professional payslips to the whole team in a few minutes each month.