Payroll Compliance Score
Answer 10 quick questions on your PF, ESI, TDS, Professional Tax and labour-law status — your compliance score, penalty risk and gaps update live on the right.
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Disclaimer: This scorecard is an indicative self-assessment of payroll compliance risk, not legal advice. Actual obligations and penalties depend on your state, headcount and wage structure. Rates and thresholds per applicable Central and State labour laws.
Your payroll compliance checklist
Payroll compliance in India spans central statutes (PF, ESI, TDS) and state-specific levies (Professional Tax, Labour Welfare Fund). Here is what every employer should have in place, grouped by the authority that enforces it.
- EPF registration once you cross 20 employees; deposit by the 15th of every month.
- ESI registration at 10+ employees for staff earning up to ₹21,000/month; contribute by the 15th.
- UAN & ESIC numbers generated for every new joiner before their first salary.
- Monthly ECR & return filing on the EPFO and ESIC portals without delay.
- TDS u/s 192 computed on projected annual salary; deposited by the 7th of the next month.
- Quarterly Form 24Q filed and Form 16 issued to every employee by 15 June.
- Professional Tax deducted and remitted per your state's slab and due dates.
- Labour Welfare Fund paid where applicable (Maharashtra, Karnataka, Tamil Nadu and others).
Payroll penalties — what non-compliance costs
Payroll defaults compound quickly: interest, damages and per-day fines add up, and several defaults carry director-level prosecution. These are the exposures the scorecard flags.
| Area | What goes wrong | Penalty exposure |
|---|---|---|
| PF (EPF Act) | Late deposit / non-registration at 20+ employees | 5%–25% p.a. + prosecution u/s 14 |
| ESI (ESI Act) | Non-registration at 10+ employees / arrears | 12% interest + up to ₹5,000/day |
| TDS on salary (Sec 192) | Non-deduction or non-deposit | 1%+1.5% p.m. + penalty = TDS + Sec 276B prosecution |
| Form 16 (Sec 203) | Not issued to employees | ₹100 / day per certificate |
| Professional Tax | Not deducted / not remitted | Penalty + interest per State PT Act |
| Labour registers | Attendance / wages / leave registers missing | Fine per register under State S&E Act |
| Labour Welfare Fund | Not contributed where mandated | Up to 2× contribution + interest |
What are the key payroll compliance obligations for employers in India?
Key obligations include: EPF contribution deposit by the 15th of the following month, ESIC contribution deposit by the 15th, professional tax payment (state-specific), TDS deduction from salary and deposit by the 7th, minimum wage compliance, and payslip issuance under the Payment of Wages Act.
Is EPF registration mandatory for all businesses?
EPF registration is mandatory for establishments employing 20 or more employees under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. Smaller establishments can voluntarily register. Once registered, EPF obligations apply even if employee count later falls below 20.
What is the ESIC contribution rate for employers and employees?
ESIC contributions are: employer pays 3.25% of gross wages and employee pays 0.75% of gross wages. ESIC applies to establishments with 10 or more employees (20 in some states) where wages do not exceed Rs 21,000 per month (Rs 25,000 for persons with disability).
What penalty applies for late EPF deposit?
Late EPF deposit attracts damages (penalty) under Section 14B of the EPF Act: 5% per annum for delays up to 2 months, 10% for 2-4 months, 15% for 4-6 months, and 25% for delays over 6 months, calculated on the amount due. Interest at 12% per annum under Section 7Q also applies.
What is the deadline for filing the EPF monthly return?
EPF contributions must be deposited by the 15th of the following month. The ECR (Electronic Challan cum Return) is filed online through the EPFO employer portal simultaneously with the deposit. Delay beyond the 15th triggers interest and damages.
Disclaimer: This tool gives indicative results for general guidance only and is not professional advice. Please verify with a qualified CA before acting on the numbers.