PF, ESI & PT: a simple compliance checklist for SMBs

Statutory compliance sounds intimidating, but for most small businesses it comes down to a handful of recurring tasks. Here’s a plain-English checklist.

Provident Fund (PF)

• Applies once you cross the employee threshold set by law.
• A fixed percentage of eligible wages is deducted from the employee and matched by the employer.
• Deposits and returns are due every month.

Employees’ State Insurance (ESI)

• Applies to employees earning under the wage ceiling.
• Both employee and employer contribute a small percentage of wages.
• Like PF, contributions are monthly.

Professional Tax (PT)

• A state-level tax, so slabs and rules vary by state.
• Usually a small fixed amount deducted based on salary slabs.
• Filing frequency depends on your state.

Your monthly checklist

1. Calculate deductions correctly for each employee.
2. Deduct from salaries in the same cycle.
3. Deposit contributions before the due dates.
4. File the required returns.
5. Keep records and payslips for every employee.

Miss a due date and penalties add up quickly — automation is the easiest insurance.

How software helps

Payroll software applies the right rates automatically, shows the deductions on every payslip, and keeps the records you need — so compliance becomes a by-product of running payroll, not a separate project.

This article is general information, not legal or tax advice. Confirm current rates and thresholds with a qualified professional.