Payroll — days into money, money into the books

Two lists of people, one monthly cycle, one journal entry.

The first thing to understand is that Deetzo keeps two lists of people, and they are joined but not the same:

A factory with sixty workers and eight logins still runs payroll for sixty. So an employee is a record first and a user second: linking a login is optional, and doing it only adds two things — that person can read their own payslips, and payroll can read their attendance. Somebody unlinked is simply paid their full month.

Where it lives

Payroll has its own section in the sidebar, below Workspace, with four entries and nothing else in it. Next to it sits People — Timesheet, Time & Leave, Attendance Report, Approvals, Leave and Team — which is where the days come from. The two are deliberately separate: People is about hours and who is in today, Payroll is about money.

The whole section is visible only to somebody holding Run payroll or Approve payroll, and only when the payroll module is licensed — so on most logins it is not there at all. The Settings list still carries a Payroll tile, and it now takes you to the same screen rather than opening a second copy of it.

Three gates, in order — and payroll is invisible until all three are open.

1. The module. Payroll is licensed separately and is not bundled in any plan. Your Deetzo account manager enables it; until then the screens do not exist.
2. The switch. Payroll → Payroll Settings → Run payroll in Deetzo. Turn it on when you are ready to pay people from here; it is the flag your team reads to know the module is in service.
3. The components. On the same screen, Add the usual set seeds Basic, House Rent Allowance, Conveyance, Medical, a balancing Special Allowance and Bonus. Pressing it again adds only what is missing, so it is safe to repeat. Add component creates your own — a name, an optional code, earning or deduction, a fixed amount or % of gross, and for an earning the flags below — and tapping a row edits it. The six shipped components can only be renamed: their flags are what make Basic count as PF wages, so they are locked.

Attendance devices

Payroll Settings is also where the attendance hardware is configured, because the days those readers produce are the days a pay run counts. Payroll → Payroll Settings → Attendance devices → Open holds four things: whether attendance is recorded from the app, from fingerprint readers, or both; the readers themselves, each with a key shown once when you add it and rotatable afterwards; each person's device ID, which is their enrolment number on the reader; and a log of recent syncs.

What the components carry

Each component says whether it is part of PF wages, part of ESI gross, taxable, prorated (does loss of pay reduce it?) and whether it is a bonus. Those five flags are what the engine reads — the name is for the payslip.

A balancing component absorbs whatever is left after the others: that is how "CTC ₹6,00,000, basic 50%, HRA 50% of basic, and the rest is special allowance" is expressed without anybody re-deriving seven numbers by hand.

A component that is not prorated — a phone reimbursement, a one-off bonus — keeps its whole amount even in a month with loss of pay. Somebody absent nine days still gets their whole phone bill back.

Where the PF ceiling and the ESI threshold come from, and who is responsible for them.

Every ceiling, percentage and slab arrives in three layers, each winning over the one before it:

Each pay run stamps the rates it used — and which table they came from — onto the run itself, so a payslip read in 2029 can still say why September 2026 used a ₹15,000 ceiling.

The Statutory rates card shows the PF and ESI figures: 12% employee and 12% employer of basic + DA with 8.33% of it going to the pension scheme, the ₹15,000 PF wage ceiling, EDLI at 0.5%, admin charges at 0.5% subject to ₹500 an establishment, ESI at 0.75% employee and 3.25% employer, and the ESI threshold of ₹21,000 — ₹25,000 with a certified disability. Professional tax and income tax are not on that card; they are per-employee and appear below.

Professional tax

PT is a per-state slab table, applied by the state on the employee's salary structure: a Mumbai company with a Bengaluru office deducts under two tables in the same run. A state gives one of three answers, and the third is the one that matters:

A gross that no slab covers in a state that does have a table stops the run the same way. Tamil Nadu deducts, but raises a warning every run: its professional tax is half-yearly and banded, and Deetzo applies a flat monthly figure that over-deducts the lower bands.

Entering a state's slabs

Payroll → Payroll Settings → Professional tax → Enter a state's slabs. Pick the state and type monthly gross bands and what each one deducts: the first band starts at 0 and the top band has no upper limit. Alternatively, tick This state levies no professional tax. What you save replaces that one state's table and no other. The shipped states keep Deetzo's slabs, and deleting your entry goes back to Deetzo's table. The editor cannot show a slab for women, so saving over Maharashtra's table drops its women's slab.

Income tax (TDS under s.192)

Deetzo projects the year's tax from what it has paid so far plus what it expects to pay, subtracts what has already been deducted, and spreads the balance over the months of the financial year that remain. The tables shipped are verified against the Finance Act 2025, FY 2025-26:

A bonus is counted once in the projection rather than annualised, which is what stops a Diwali bonus predicting a year of Diwali bonuses. Two things stop the run rather than guess: an income high enough to attract surcharge — above ₹50,00,000 projected — because no surcharge table ships, and a financial year later than the table Deetzo has verified, which says so out loud instead of quietly deducting last year's rates.

Four steps, each saving on its own.

Payroll → Employees → Add employee. The form is four steps because an employee record is worth having before the salary is agreed:

Employee ID is payroll's own numbering — EMP-0001, and the Next button gives you the next one. An auth id is not something anybody wants printed on a payslip.

A consultant is excluded from runs with a reason rather than taxed wrongly under a right-looking label: that is s.194J, not s.192, and Deetzo does not deduct it here.

Authored as a CTC, revised rather than edited, and snapshotted forever.

Enter the annual CTC. Basic is a percentage of it, HRA a percentage of basic, and the balancing component absorbs the remainder — the monthly and annual columns update as you type. The editor refuses a structure whose named components already exceed gross, because the balancing figure would go negative and quietly pay somebody less than the sum of their own lines.

Two mechanisms that stop a raise rewriting a payslip

1. Revisions, not edits. Each revision is stamped with the date it takes effect. Once a pay run has used one it becomes immutable, and the editor opens on a new revision instead — with the salary history shown above it.
2. Snapshots. The component lines are copied into the revision by value. Renaming "Conveyance" next year cannot change what a payslip already says.

Deductions you have added as components, such as a pension plan or a loan instalment, get their own table on the structure. Each one shows this employee's amount. A deduction left at 0 stays off the structure, and a later revision does not add it back.

The four choices on every structure

Six calculations, and the trap each one avoids.

One run a month. The preview is where the arguments happen.

Payroll → Pay Runs → Start a pay run, pick the month. Deetzo suggests the month just ended — which is what somebody opening payroll on the 1st is there to pay. Computing reads every active employee, the structure in force on the last day of the period, the month's attendance, approved leave, open advances and the year to date, and writes one payslip per employee marked preview.

Recomputing is safe and repeatable: fix a structure, press Recompute, and the same payslips are overwritten rather than duplicated. Anything the new computation does not produce is removed, so the list always matches the header.

Exceptions: what stops a run and what does not

A run of eighty people reports all eighty problems on one preview rather than stopping at the first, and every exception names the person.

One button, five consequences.

Approve and post does all of this, or none of it:

• Posts one balanced journal entry dated the last day of the period, so the expense lands in the month it was earned.
• Locks the attendance for the period — no punches, marks or corrections after the fact. You can also close a month yourself, before the run, from People → Time & Leave. Reopening a month a run has already paid is a payroll decision and needs an approver.
• Marks every payslip final and every salary revision it used consumed.
• Draws down any salary advances it recovered.
• Records who approved it, and when.

Computing needs Run payroll; approving and reversing need Approve payroll. Somebody who only approves can open Pay Runs and read them — they could hardly approve what they cannot see — but the Approve button is the only one they get.

Three more ways approval is refused

• Any blocking exception still stands. Fix it, recompute, approve.
• The books are locked on or before the last day of the period. The lock is now enforced at the moment of posting as well as at the button, so nothing slips past it.
• The books have never been set up. A pay run posts a journal entry, and a journal entry needs a chart of accounts. Open Books & Accounting and run the first-time setup.

The bank advice, then the record of the transfer.

Bank advice (CSV)

A file of everybody with a bank account, their IFSC and their net pay, for upload to your bank's bulk-transfer portal. Anyone without bank details is flagged on the preview and left out of the file — which is why that warning exists.

Record payment

After the transfer goes out, Record payment asks three things:

Salaries Payable comes off the balance sheet, the bank goes down, and every payslip is stamped paid.

One entry per run, and it always balances.

The debits are the employer's full cost; the credits split it into what is owed to the employee, to the government, and back to the business. Paying salaries clears Salaries Payable. The statutory payables sit on the balance sheet until they are remitted — and remittance has no screen yet, so until it does, clear them with a manual journal when you pay the challan.

Gratuity is accrued at a rate that ships as zero, so those two lines are ₹0 and do not appear until somebody sets a rate for your account. Ask if you want the provision built monthly.

Salary TDS has its own account because s.192/24Q and s.194/26Q are different challans and different returns — pooling them makes the 24Q reconciliation impossible.

Reverse a run posted wrong; use arrears for a fact that changed later.

Reverse asks why — the reason stays on the record — and then mirrors the journal, voids the payslips (never deletes them, because the employee may hold the PDF), unlocks exactly the window the run locked — not the month it is named after — releases the salary revisions it consumed, and gives back what it recovered from advances, so a second run does not deduct the same instalment twice. The run then offers Compute again, which is the point: fix the cause and compute the month afresh.

A fact that changed later — a backdated raise, an approval that arrived after the run — is not a reversal. It is an arrears line in the next run.

The one document that leaves the building.

Every statutory line carries what it was computed on — "on ₹15,000, at 12%, ceiling ₹15,000" — so a payslip re-read in three years explains itself instead of needing the rates of the day. Loss of pay and part-month proration are shown per line and again as a total, and they are shown separately — "you were not here yet" is not "you were away". The attendance block prints payable days, present, paid leave, unpaid leave, days not employed and loss of pay, and the header carries PF wages, ESI gross, the PT state and the tax regime.

My Payslips lists your own months, newest first, each showing the net, whether it has been paid, and any loss of pay — a voided month stays visible, struck through. Tapping one opens the same summary HR sees, with a Download PDF button. The query is scoped to your own record, so there is nothing to see but your own.

The PDF is built the moment you ask for it and handed straight to your browser — Deetzo keeps no copy on a server. Re-download it from the run or from My Payslips whenever it is needed again.

A different shape of month, not a monthly salary with deductions.

Switch the pay basis to daily under More → Work week & pay basis and three things change:

• Holidays and weekly offs stop being payable.
• There is no loss-of-pay line at all — the month simply has fewer days.
• Everybody paid this way needs a Deetzo account, because their pay is their attendance. Anyone unlinked is refused by name — and so is anyone linked whose month has no recorded days at all, since paying them nothing is more likely a missing roster than a month off.

The day rate comes from the structure's divisor, so set daily-wage structures to fixed 26. A monthly gross of ₹26,000 on a 26 divisor is ₹1,000 a day; twenty-four attended days is ₹24,000.

What catches people out.

• Verify the rates before your first run. They are shipped values with a date on them, not live law.
• A structure with no effective date inside the period pays nobody. A revision effective 1 October does not apply to September; the run reports "no salary structure effective on 30 September" and blocks.
• Overtime is not paid automatically. Attendance records the minutes; nothing prices them. Add a manual earning if you pay overtime.
• Once a revision has been used it is frozen. Correcting a paid month's salary means a new revision, and the editor opens on one for you.
• Employer contributions are not part of net pay. If your figure for "what leaves the bank" includes them, it is wrong by the employer's share.
• Name the bank account when recording payment. Otherwise it lands in Undeposited Funds and will not reconcile.
• Approving locks attendance. Do the corrections first; unlocking means reversing the run.
• TDS is a projection. It is not a final computation and it is not a Form 16 — that comes from TRACES after 24Q is filed.
• Check the professional-tax state on every structure before the first run. Seventeen states ship without slabs and stop the run until you enter them in Payroll Settings; nine more deduct nothing at all without saying so. §02 has the lists.
• An old-regime employee is over-deducted. Declared exemptions and Chapter VI-A deductions are not applied yet, and the run warns you every month until they are.
• There is nowhere to record a leaver. No leaving date, no active switch. The run will block on somebody who has gone, and the fix is a support request rather than a field.
• The statutory payables are not cleared by Deetzo. Remitting a challan is a manual journal until the remittance screen exists.

Said plainly, so nobody discovers it on the 30th.

• File anything. The EPF ECR, the ESIC file and the 24Q annexure are on the way; the challans are always made on the portals.
• Issue Form 16. It comes from TRACES after 24Q is filed.
• Pay consultants. s.194J, not s.192 — they are excluded with a reason.
• Email payslips. In-app download only.
• Verify investment declarations. Declared, unverified, and labelled as such.
• Convert a leave-quota overrun to loss of pay. Unpaid leave that is recorded as unpaid is docked, but nothing watches a quota and nothing flags an overrun — a human decides, from the leave screens.
• Full & final settlement, arrears and reimbursement claims. Planned, not built.
• Price overtime. Attendance records the minutes and payroll carries them onto the payslip, but nothing turns them into money. Add a manual earning.
• Record a statutory remittance, or hand out a salary advance. Both post correctly when they happen; neither has a screen yet.
• Type a PF, ESI or income-tax rate. Those are support requests today — see §02. Components and professional-tax slabs you can edit yourself.
• Collect investment declarations. There is no declaration form; the old-regime warning exists because of it.

See also: the Attendance & Leave guide and the Books & Accounting guide.