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Payroll Calculator — Total Employer Cost

Calculate your total monthly payroll cost including employer PF contribution, ESI, and gratuity provisioning — not just gross salaries.

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👥 Enter Employee Details

Employer PF: 12% of Basic | ESI: 3.25% of Gross (if salary <₹21K)
Gratuity: 4.81% of Basic (provisioning)

📊 Total Payroll Cost

Enter employee details to calculate payroll
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Disclaimer: Results provided by this calculator are for educational and estimation purposes only and do not constitute formal financial, tax, or legal advice. Actual rates, deductions, and statutory requirements vary by jurisdiction and business circumstances. Consult a chartered accountant or company secretary before making business financial decisions.

Why Payroll Cost Exceeds Gross Salary

Your true cost of employing someone is higher than their gross salary alone: employers must additionally contribute 12% of basic salary to EPF, 3.25% of gross to ESI (only for employees earning up to the ESI wage ceiling, currently ₹21,000/month gross — above that threshold, ESI doesn't apply), and provision for gratuity (payable after 5 years of continuous service). This calculator totals all of these into your real employer cost per employee.

Worked Example

10 employees at an average gross salary of ₹50,000/month: base payroll = ₹5,00,000/month, plus employer PF (₹2,400 per employee on basic, illustrative), for a total monthly payroll cost of approximately ₹5,24,000 — projecting to roughly ₹62,88,000/year. Note ESI shows ₹0 here since ₹50,000/month exceeds the ESI eligibility ceiling; for lower-wage employees, add that 3.25% employer contribution too.

Frequently Asked Questions

ESI (Employee State Insurance) only applies to employees earning up to a statutory wage ceiling — currently ₹21,000/month gross salary. Above that threshold, neither employee nor employer makes ESI contributions, which is exactly why a ₹50,000/month salary example shows no ESI cost in this calculator.
EPF is mandatory for most establishments with 20+ employees, and for employees earning up to a statutory basic wage ceiling, though many employers extend it voluntarily to all staff. Employer contribution is typically 12% of basic salary (a portion of which routes to the EPS pension scheme) — verify your specific obligations with a payroll consultant given various exemptions and thresholds.
Gratuity becomes payable to an employee who completes 5 or more years of continuous service with the same employer, calculated as (15/26) × last drawn salary × years of service, subject to a statutory cap. Many employers provision for this liability monthly/annually in advance rather than facing a large lump-sum obligation later — this calculator includes an estimated provisioning amount for planning purposes.
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