Income Tax Slab in Frappe HR: Defining Tax Rates for Payroll
An Income Tax Slab defines the tax rates applied to ranges of income when payroll computes income tax. Each slab lists the income bands and the percentage charged on each, so Frappe HR can work out the right tax for every employee’s taxable salary.
You will find it under Home > Human Resources > Payroll > Income Tax Slab.
BEFORE YOU START
Have your Company and Currency ready, and the current tax bands and rates that apply in your jurisdiction.
How to create an Income Tax Slab
- Open the Income Tax Slab list and click New.
- Enter a Name and set the Effective From date.
- Select the Company and Currency.
- In the Taxable Salary Slabs table, add each band with its From Amount and the Percent Deduction.
- Set any additional options, such as a standard tax exemption amount, then Save and Submit.
How the slab is applied
An income tax slab is linked to an employee through their Salary Structure Assignment. When payroll runs, the slab’s bands are applied to the employee’s taxable salary to calculate the tax, which is then deducted across their salary slips within the payroll period. Because slabs are effective-dated, you create a new slab when rates change rather than editing the old one.
COMMON MISTAKE
When tax rules change, don’t edit a submitted slab create a new Income Tax Slab with the correct Effective From date and assign it going forward. Editing history risks recalculating past payslips incorrectly.
TIP
Because tax rules vary by country and change over time, confirm the current bands and rates for your jurisdiction with your finance or compliance team before setting up a slab. The mechanics are the same everywhere; the numbers are what must be right.
Related Topics
- Payroll Period
- Salary Structure Assignment
- Salary Component
- Salary Slip
SUMMARY
An Income Tax Slab defines the tax rates applied to bands of income in payroll. Create one with a name, effective-from date, company, currency, and a Taxable Salary Slabs table of bands and percentages, then submit. Linked to employees via their Salary Structure Assignment, the slab is applied to taxable salary to compute tax across the payroll period. Slabs are effective-dated, so create a new one when rates change and always confirm the actual bands for your jurisdiction.
