Last Updated on 27/01/2021 by Deepak Singla
If you are working in an organization as an employee then you may need a salary certificate for various purpose. Also as an employee, you have the right to get a Salary certificate from your employees as proof your employability in his organization
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What is a Salary Certificate?
Salary certificate is an official document provided by the employer to the employee and verified by an authorized person of an organization, on their company letterhead with his signature and company stamps to verify employee’s employment. A salary certificate is a legal proof of employee salary employment period with a time frame of his services and of an employee
A salary certificate format contains the various heads under which the net salary of the employee will be calculated after the addition of all allowances and subtraction of various deductions. It will be issued by the employer for the employee whenever the employee requests the employer to furnish him with his salary certificate.
Salary Certificate Format
The following is the Salary Certificate Sample 2021
SALARY CERTIFICATE
Signature of employee: ————————————
This is to certify that Mr. / Mrs. —————————————————S/o / D/o / W/o Mr. —————————————————– residing at —————————————————————————————————————————whose signature appears above is a permanent employee of ————————————————————————————————– (name of department/institution) and he/she has drawn Pay and Allowances are as follows for the month of —————————– (month and year):
| GROSS SALARY (Rs.) | DEDUCTIONS (Rs.) | |||
| Basic Pay | EPF | |||
| DA | Insurance | |||
| HRA | Home loan | |||
| Medical Allowance | Car loan | |||
| Others / Misc. | Others / Misc. | |||
| Gross Salary (1) | Total Deduction (2) | |||
| NET SALARY (1-2) = Rs. —————————–
(Net Salary Rupees ————————————————————————————– Only) |
||||
Date of birth : ———————————————————-
Date of joining in the present employment : ————————————————–
Present designation : ———————————————————
Date of retirement : ———————————————————
This salary certificate issued for : ——————————————————–
For ——————————————————–
Signature and Designation of Officer Authorised
Place: Office Stamp: Date:
Download Salary Certificate Format Template
Download Salary Certificate Format In Word, PDF here
Salary Certificate Format in Word:
Download Salary Certificate Format in Word
Salary Certificate Format in PDF:
Download Salary Certificate Format in PDF
Note: Once you download the salary certificate (word/excel/pdf), you will be able to edit it as per your requirements. Always Download Salary Certificate Format in Word. Because you can easily edit salary Certificate in word format. Salary Certificate Format in PDF version not editable.
Components of a salary certificate
The components of a salary certificate can be broadly classified into two heads:
- Earnings (Basic Salary + Various Allowances )
- Deductions ( TDS, Professional Tax, Contribution to Provident Fund)
a. Earnings
- Basic Salary
The basic salary refers to the amount of money that an employee is entitled to get before the addition of any allowances and subtraction of any kinds of deductions.
- TA
Travel allowance is given to an employee for any sort of travel done by the employee and paid by the employee on behalf of the office. In such cases, the employee is later compensated by granting him the Travel Allowance (TA).
- DA
Dearness Allowance (DA) is calculated based on the average basic salary to nullify the effect of inflation on a person and his household. This is normally given in the case of government employees.
- HRA
HRA(House Rent Allowance) is given to employees based on location and basic salary ranging up to 40% to 50% of basic pay. HRA can be claimed for tax deduction under section 10 of the Income Tax Act 1961.
- Other allowances
This comprises of any other allowances that are allowed to an employee by the employer. Such allowances that don’t go in any of the heads are categorized under one head as other allowances.
b. Deductions
- TDS (Tax Deducted at Source)
This refers to the amount of money deducted by the employer from the employee’s salary on behalf of the Income Tax Department. This amount is later transferred to the government for payment of employees tax.
- Employees Provident Fund
At least 12% of basic salary is transferred to the EPF (Employees Provident Fund). Contribution to EPF is not considered for Income Tax calculation and is exempted by the income Tax Act 1961.
- Professional Tax
This is a component of the salary certificate that is deducted for almost everyone be it a professional or a salaried individual or a trader, professional tax is deducted from everyone based on the criteria of the state and central government and the Income Tax Act 1961.
Salary Certificate for Bank Loan in India
While applying for a loan or issuing of new credit card, the most important document that the bank or credit card issuing company will ask from you is your salary certificate. Your salary certificate will be used to ascertain whether you will be able to pay off the debts and interests in time.
How to get employee Salary Certificate
A salary certificate is an important document that is supplied by the employer to the employee after the employee is hired in a certain organization. It is mandatory for the employer to give the employee a Salary Certificate. Persons working in Government organizations get their salary certificate almost immediately after recruitment.
For small and micro organizations or new startup business in India, it is not possible to hand over a salary certificate to each of their employees. So in such a case if the employee needs a salary certificate, he can request his employer to furnish him the certificate by requesting the employer through the Salary Certificate Request Letter.
Also If the Salary certificate is lost, the employee can request a new one by writing a Salary certificate request letter to his employer.
Salary Certificate Format in Word:
Download Salary Certificate Format in Word
Salary Certificate Format in PDF:
Download Salary Certificate Format in PDF
How to make a Salary Certificate online?
- Click on the above link and download the Salary certificate format in Word. Because word format is editable but you can’t edit Pdf Version.
- Fill up the details such as your name, employer’s name/organization name.
- Fill up all details relating to your salary and tax.
- Verify all the figures with documented evidence.
- After completion goes to your employer and takes the signature of your employer or the organization’s seal.
Use of Salary Certificate for an employee
An employee salary certificate is not only a Financial tool but an Identical tool too. A salary certificate often certifies that a particular person is or was a salaried employee of a particular organization.
Apart from being an Identical tool, Salary certificate is used for the following purposes:-
1. Salary certificate for Bank Loan.
A bank often demands the salary certificate of an Individual to see and access the credibility or credit score of an Individual. It is used to determine whether a person will be able to pay off his loan and interests on time or not.
2. Payment of Tax
A salary certificate is used by taxation authorities to determine whether a person is liable to pay tax or not. It is also used to measure in which tax slab will an individual fall under the Income Tax Act 1961.
3. Salary Certificate for Loans/Credit Cards
While applying for a loan or issuing of new credit card, the most important document that the bank or credit card issuing company will ask from you is your salary certificate. Your salary certificate will be used to ascertain whether you will be able to pay off the debts and interests in time.
What is a salary letter?
A salary letter is a request letter that an employee sends to his employer, requesting him to release his or her salary.
Salary Certificate letter
A salary certificate letter is a letter issued by the employer to the employee that states that the bearer of the letter holds a position in a certain organization and has decent, regular, and dependable income.
What is the difference between Salary Certificate and Salary
Certificate Letter?
A salary certificate is a certificate issued by the employer to his employee during the time of recruitment that states that the bearer of the certificate is a salaried employee of a particular organization. It also states the various heads under which the employee’s salary will be calculated.
WHEREAS
A salary certificate letter is a letter issued by the employer to the employee that states that the bearer of the letter holds a position in a certain organization and has decent, regular, and dependable income.
What is a pay slip/Salary Slip?
A Payslip is a document which the employee gets, provided to him/her by the employer as a proof of payment. It contains the description of how the salary is calculated after considering all the allowances and deductions. Salary slip contains the actual salary figures and is issued every time payment is made to the employee by the employer.
What is the difference between Salary Certificate and Salary Slip?
Difference between Salary Certificate VS Salary Slip:-
| Basis | Salary Certificate | Salary Slip |
| Issue | Salary certificate is issued for the entire tenure of the job. | Salary Slip is issued every month by the employer. |
| Changes | Salary Certificate does not change throughout the course of the job. | Salary slip is prepared on the basis of salary of employee as per his working days. |
Salary Slip Template
- Document Format (.docx)
Link :- https://drive.google.com/file/d/1-AM4ZyJ4TDAdM7lqtk9Em0_Wgqhc5IIR/view?usp=drivesdk
2. PDF Format
Link :- https://drive.google.com/file/d/1-QFqUYw9kQ3ARf9iTDcNXMIsKVplTAWG/view
3.Xlsx Format (MS Excel)
Link:- https://drive.google.com/file/d/1-YxSUWFqNnnDpm_ynt-jqHyb7svUwz6c/view
Mandatory Components that we need to show in our salary certificate
The important components that we need to show / or are mandatory to show in the salary certificate are:-
- Name of Employee
- Name of the employer along with an address
- Employee ID (If provided)
- Designation and Branch (Department) of the employee.
- Date of Joining of the employee
- Salary Breakup of the employee
Conclusion
Salary certificates and salary slip appear to be very similar however they are very different. As soon as you are hired for a job, your salary certificate will be issued which will have the various breakups/heads through which your salary is calculated. It will remain the same throughout the job and changes will be made only when there is an increase or decrease in your salary. On the other hand, a Salary slip is prepared for you every month by your employer and your salary is calculated based on all the information given in your salary certificate
