Form 16 gross salary not matching with F&F Statement?
Form 16 gross salary details may sometimes not match for separated employees. This happens because of employees F&F process not being run and also in cases when separation happened in the previous financial year and adjustments / f&F process was not run in that year.
To avoid such situations, you must ensure that all F&F calculations are processed in the relevant financial year, before closing the March period.
Making additional payments to a separated employee / FnF process?
There are several instances when settlement of dues of resigned / separated employees is done progressively over few months after separation. These dues may include allowances like leave encashment, LTA / LTC, Gratuity, Variable pay like performance pay, incentive, etc. Any such payment made also needs to incorporate the tax liability on the employee's income.
Here is a solution to handle such cases:
1. When the employee is separated, mark it as Process and Hold salary. Do not process F&F for such case.
2. Ideally, you should include Leave Encashment and Gratuity in this calculation as it will be known at the time of settlement itself. This will reduce the number of times additional payment is to be done to the separated employee.
3. The Leave encashment days and Gratuity amount will have to be be a manual input from your side. Presently these heads are available only during F&F and not during normal salary calculation. Both these will be added to your input screen by our team once the solution is agreed.
4. His/her name will appear in the Salary Statement of that month but *will not* appear in the Bank Statement.
Now, if you DO NOT need to make any additional payment during the same financial year, then in the month of March, take all such Process and Hold cases, process their F&F and mark it as Settled.
If you have any additional payments to be made, you can make ONE such additional payment as follows:
4. Go for F&F pending process
5. Enter the additional amounts in F&F and check the F&F settlement sheet
6. If all ok, mark the employee as Settled
Such additional payment can be made in the same financial year or even next year.
The 1st payment made with Process & Hold will update all the tax calculations and Form 16 correctly.
The 2nd payment made with F&F process and Settlement will also update tax calculations and Form 16 correctly for the financial year in which you do the F&F settlement even if you have done Process & Hold in the same financial year.
As per above solutions, you can do max 2 payments to the separated employee, one during the separation month using Process & Hold and the second payment using F&F. You can consider adopting this solution if it meets your needs.
If employee is left and not coming in salary statement?
Please go through below mentioned points to understand FNF PROCESS
- If you have generated payroll and mark an employees left and their FNF TYPE
PROCESS AND PAY
PROCESS AND HOLD
- You have processed their normal payroll and marked left then in salary statement these employee will be visible.
- Once employee is marked separated ,if you have processed normal payroll and FNF TYPE is
PROCESS AND PAY
PROCESS AND HOLD
Then both above FNF Type will visible in the salary statement.
- If you have processed their FNF then these employees will be removed from salary statement.
- If you marked these employees settled then these employees will be visible in salary statement.