Salary Component Library
Standardise payroll with RazorpayX Payroll’s Salary Component Library for accuracy & compliance.
The Salary Component Library in RazorpayX Payroll is a structured repository that standardises salary components. It categorises earnings, deductions, benefits, and perquisites, so you can easily define and manage salary structures. It also ensures compliance with tax and statutory regulations.
When setting up payroll, different components make up an employee's salary—some add to their pay (like bonuses and allowances), while others deduct from it (like taxes and loans).
In RazorpayX Payroll, you can customise both addition and deduction components to suit your organisation’s salary structure.
A Custom Addition Component is any salary element that increases an employee’s total earnings.
These could be things like:
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Bonuses (For example, Performance Bonus)
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Allowances (For example, Travel Allowance, Meal Allowance)
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Perquisites (For example, organisation Car, Meal Coupons)
By defining addition components, you can ensure employees receive the right benefits and allowances while maintaining compliance with tax rules. You also get to standardise salary structures so that similar components are treated the same way for all employees.
To add a new custom addition component:
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Navigate to the Settings→Salary Component Library→Edit.
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Click Create component and select Earning from the dropdown.
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Fill in the General & Pay Configuration details:
- Enter a Component name (make sure it's unique as two components cannot be of the same name).
- Add a Display name in payslip and salary structure(this will show up in payslip and reports).
- Write a Component Description to explain what it is used for.
- Choose the Pay Frequency (For example, Monthly/Fixed or any other option).
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Set up Prorations and Arrears:
- Toggle on the Prorate the component if it should be adjusted based on working days.
- Toggle on the Calculate arrears option if missed payments should be paid later.
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Click Next: Taxation to Navigate to tax settings.
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Configure taxation details as per your organisation's policies.
- Review everything to make sure it's correct.
- Click Next: Review to check the customisations added to the salary component.
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Review all the customisation added in the salary component.
- Click on Create component to add the new component you just created.
To modify a custom addition component:
- Navigate to the Salary Component Library.
- Select the component you want to edit.
- Click View details to open the component settings.
- Click on Modify and make the necessary changes.
- Click Save Component to modify the component.
Watch Out!
The modify screen will also show predefined components set as per the government mandates and organisation policies. Any changes you make will be on top of those existing rules.
To disable a custom addition component:
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Follow steps 1-3 from the modification process.
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Click the Disable button.
Watch Out!
If the component is currently included in any employee’s salary, Payroll will not allow you to disable it immediately.
You must first remove the component from all employee salary structures before disabling it. Once it is no longer assigned to any employee, you will be able to click the Disable button and deactivate it.
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