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How to Create Salary Structure based on Gross Salary in Tally.erp 9

Configuring Salary Structure is very important in Payroll processing and in HR management

Tally offers configuring Salary Structure in a very easy way.Let’s learn how to configure Salary Structure based on Gross Salary

As I repeatedly told that Tally.erp 9 provides a complete in-built Payroll module free of cost which helps in Salary Structure , PF , Professional tax, Gratuity, ESI deduction and now it even offers TDS deduction on Salary, Form No. 16a for employees, Employees complete Return preparation, declaration whatever you ask for payroll, it is available in Tally.

In Many company Salary structure is bifurcated into different pay heads where the Gross salary is defined by the management and then % of other pay-head is given to you so, How you will handle this situation in Tally. Let me explain you today how to handle this issue in Tally.

Suppose you were given the below table and asked to design a Salary structure :

Gross Salary Basic (60% of Gross) HRA (20% of gross) Conv (5% of Gross) Medical (15% of Gross) PT (As per Slab) PF(12% of Basic)
Hitesh 17000 10200 3400 850 2550 200 1224
Savita 7500 4500 1500 375 1125 175 540


you do not need to feel confusion, here Tally.erp 9 Release comes to help you to design the best suitable Salary Structure. Follow the procedure explained here :

  1. Create Gross Salary Pay Head
  2. Create Other Pay Heads
  3. Create/Alter Salary Details
  4. Process Payroll

Step 1: Create Gross Salary Pay Head for Salary Structure

  • Create a Pay Head called Gross Salary under Pay Head TypeEarnings of Employees
  • Select Calculation Group in the Under field

Note: The Calculation Group is created so that the same can be Excluded using a Voucher Class during the Salary Processing

  • The option Affect Net Salary should be set to No.

Step 2: Create Other Pay Head for Salary Structure

Create all the Pay Heads as computed Value with computation method as Sspecified Formula.

Pay Head creation for Basic Pay is shown below:

Step 3: Set /Alter Salary Details for Salary Structure

Specify employee wise salary structure in salary details including Gross Salary Pay Head as per the order shown below as all the Pay Heads depends on the Gross Salary Pay Head:

Step 4: Process Payroll

Process the Salary using the Voucher Class by after the steps given:

  • Payroll Voucher > Press Ctrl + F4 > Select Pay Process in Voucher Class
  • Press Alt + A for Payroll Auto Fill

Salary structure may be vary from business to business, organization to organisation and generally it is defined by the HR people of the company or the management

Release 3 is not available for every one. only the Tally users whose Tally.net Subscription is active can use the Release 3.

If your TNS is expired you can renew it through us online or offline we will guide to set up the complete payroll in Tally.erp 9


    1. Hello Shailiji,
      Thanks and welcome on board.
      Actually due to lack of knowledge people uses only 25% of the actual possibilities of Tally.I am just busy with an Accounting project for one of my clients. Once I get free, I am planning to prepare some video to show how Tally is important in day to day accounting and saves valuable time.

      1. nawaz

        dear mahendra :

        Now a days i m using telly and i have some quires related to tally accounting application

      2. Vishalakshi

        Hi Mahendra,

        i have read your comments , i am an accountant i need ur help on pay roll , can u help me on this

  1. vijay

    Hello sir,
    my tally srl no- 7XXXXXXX
    pls give me tips in Cheque Printing by tally
    i set hdfc cheque printing in tally but in self cheque by contra there are no display of cheque printing,i select payment receipt as contra yes then it is possible,so i want to know i can apply this configuration is it valid in accounting by your instruction.i hope needful.


    1. Hello Vijay,
      There is no hard rules that you can not use Payment/Receipts as “Contra ” Though some CAs who are sill living in 90s believes that Contra can’t be used for Payment or Receipt!
      I do never use Contra voucher and I use Cash/bank inter transaction only in Receipts and payment vouchers Also. Recently during audit, our CA had asked me the same point that why I don’t use Contra for inter cash/bank transaction.

      I simply told him that just give me the Rules if it is compulsory to use Contra for interbank/cash transactions!
      So, go ahead with contra in receipt/payments
      Further, I will advice you to upgrade your software to Release 3.0 as cheque printing is more easy there. Remember it is free for you As your TNS is active
      If you need my assistance in migration and upgradation than do not hesitate to contact me.

  2. vijay

    Thank you very much sir,

  3. vijay

    Dear sir,
    i want to know some query in service unite account.
    our business is transportation we have not vehicle of our fixed asset but received Equipments on other company hire basis or subcontract.Now we start new firm services of trnasportation.other than old firm.
    in this firm we purchase 2 loading tata trucks
    by partys service order we send our truck to their places for loading & unloading after finished work we make service Invoice of load or trip.so how to manage purchase against sales of service, i am new in this lease account,pls send tips.

  4. Vijay

    Hello Sir,

    Good morning.
    I am waiting for your answer.
    Have a nice day.


    1. Vijay,
      Currently I am busy will look your matter latte when I get free times.
      I Give priority to my own clients for support issue.So, you have to wait

      1. Vijay

        Hello sir,

        I am out of station for two days.
        so, I read your message today.
        Ok..no problem , give my answer when you free from your clients.
        I am waiting for your reply.


        Have a nice day


  5. Anver sadique

    After posting invoice with naration in tally,how can i take print the invoice with naration?

  6. sapna

    simply by using f12 features, fix yes on show narration also..

  7. Patra

    can you give me some tips about salary booking in tally

  8. chandra palash soni

    i am expart and master in tally accounting software.
    if any problam in tally software. please ask ne


    i am trying to print the multi sales vouchers, but in printing it shows the page no in the heading . How to remove it , please guide us

  10. sumit

    can you give me some tips about payroll.

  11. Nabin Jain

    i used to pay salary to my staff named (Harish)…but i m confused what will b the correct ( under head) for both “salary” & “staff (harish)”

  12. ekta

    i have enterd all the required details in payroll info. but when it comes to payroll voucher entry , the amount is not displaying in auto fill means there is some problem in salary calculations .. can u help me to solve this querry

    1. Hello Ekta,
      Have you entered the Attendance of the staff? You need to check the configuration of your set up.
      Please refer the Payroll Set up Guide without checking your configuration via Team Viewer, we can’t solve the issue because we need to check all the set up in your system.

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