Compute ESOP and RSU perquisite tax at exercise run, variable pay and performance bonuses inside the regular cycle; apply the correct Professional Tax for employees working remotely across states, and keep contractors and full-time employees on separate, correctly taxed tracks without a finance team reconciling it by hand every appraisal cycle.
A 250-person SaaS company with employees across six cities, 30% of headcount on variable pay, and a mix of full-time staff and contractors faces payroll complexity that general-purpose software was never designed to handle.
Every exercise event creates a taxable perquisite under Section 17(2), and TDS under Section 192 must be deducted correctly the same month. Get it wrong and Form 16 is wrong for every employee who exercised.
Bonuses like joining, retention, and quarterly or annual performance payouts are tied to appraisal cycles. These are usually processed manually, outside of the regular payroll cycle, with TDS recalculated by hand.
Engineers that are located in Pune, Hyderabad, Bengaluru, Mumbai, and Delhi NCR sit on the same team but fall under different professional tax slabs and state rules, even though when payroll runs from a single office.
Freelance developers and consultants need TDS under Section 194J, not PF or ESIC. Misclassifying a contractor as an employee or the reverse is a real, penalty-bearing compliance risk.
Attrition and tech hiring usually move faster than other industries. Onboarding 40 engineers in a quarter and processing F&F for departing employees within the statutory window strains a manual payroll process.
Salary revision in mid-cycle and after appraisals directs to recalculating TDS, updating CTC structures, and reissuing payslips for hundreds of employees within a couple of days, often within the busiest month for HR.
IT and software companies run four to six distinct workforce categories at once. Each with different pay structures, tax treatment, and compliance obligations. TankhaPay is built to handle all of them from one login.
PF on basic salary, CTC-based salary, TDS under the chosen regime, LTA structuring, HRA, and gratuity are computed correctly every cycle.
Full PF + TDS + GratuityUnder section 194J TDS on professional fees, there is no PF or ESIC obligation, and GST applicability is tracked and invoiced separately from employee payroll.
Section 194J TDSThe value of perquisites is calculated on exercise or vesting, TDS is deducted as per Section 192, and it is correctly shown in Form 16 and Form 12BA.
Perquisite Tax ComputedA professional tax is levied by each employee's state of registration for work irrespective of office city, and attendance is monitored digitally without any biometric requirements.
State-Wise PT, No BiometricPayroll is based on stipend, PF voluntary, and smooth transition when an intern joins as a regular employee, ensuring compliance with NATS/BOAT, wherever applicable.
Stipend + Conversion WorkflowWhen you have an international workforce or the overseas parent company is giving you equity, payroll takes care of all your cross-border elements.
Cross-Border AwareRunning payroll for a tech company means handling ESOP events, variable pay, and a multi-state remote workforce all in the same cycle. Here is how TankhaPay simplifies every step.
Gather FTE, contractor, intern, and remote worker information in one place. Record ESOP grants and vesting periods, salaries, and work state registration – all in real time as your company grows.
TankhaPay uses the FMV & exercise price to calculate ESOP perquisite value, deducts TDS as per Section 192, and executes variable pay which is included in join bonus, retention bonus, quarterly payments all together in one cycle. Off-cycle processing for such a task is not required.
Each and every mandatory deduction is done with utmost accuracy - PF at the right basic, TDS as per the relevant scheme, PT as per each employee's state of employment, and maintenance of Shops & Establishments Act register for your registered companies.
Once payroll is approved, salaries are disbursed directly to bank accounts for the entire team, wherever they're working from. Digital payslips, Form 16, and Form 12BA are generated instantly in the employee app - no separate filing step
CMMI Level 5 is a certification held by fewer than 1% of Indian tech companies. It means the quality standard your ESOP and statutory filings are processed under is the same standard trusted by the Government of India.
There is no payroll software in India that has this certification. If your investors/auditors ask you who does your payroll processing, you win with this line.
We have processed payroll through every significant Indian tax and labour law change since 1998. New ESOP rules under the Income Tax Act 2025 are not a new challenge for us.
Encrypted storage, role-based access, and full audit logs on every payroll record - built for the security diligence tech companies face during fundraising and audits.
Run it in-house while you're 50 people. When you cross 500 and need a dedicated payroll team, switch to managed services on the same platform - no migration, no data loss.
From ESOP perquisite tax to multi-state remote workforce compliance - every tech-industry requirement handled by the system, not reconciled manually by your finance team.
FMV basis for determining perquisites, tax on salary (Section 192) TDS collected during the same month, and valuation of shares on vesting date. TankhaPay manages ESOPs taxation so that your employees don’t get any surprises on Form 16.
Joining Bonus, Retention Bonus, Quarterly/Annual Performance Bonus depending on the appraisal cycle – all these bonuses are calculated and paid within the cycle and not as an off-cycle process which the finance department of every organization dreads each quarter.
Employee registration across different states, either remote or hybrid, will have different Professional Tax rates. TankhaPay automatically calculates the PT amount as per the state the employee works in, without the need for any lookup table in HR.
Section 194J TDS for Consultants, No PF & ESIC liability, and Invoice-based Payment Tracking – maintained completely independent of FTE payroll so there is always zero chance of misclassification, even as you build up your pool of contractors.
Tech hiring and attrition happen quicker than most industries. TankhaPay boards new employees into payroll within a day and takes care of F&F within the statutory period, so no hiring rush or attrition spike ever creates any backlog.
Four steps. No manual ESOP calculation. No spreadsheet for variable pay. No payroll errors on the night before disbursement.
Employee, contractor, and ESOP data syncs automatically. Work-state, salary structure, and vesting schedules updated without manual entry.
Zero data entry effortESOP perquisite, variable pay, PF, TDS, and multi-state PT calculation is automatic using the latest statutory rates.
Per employee, per state, per cycleFinance reviews and HR head approves via maker-checker. Anomalies flagged before disbursal - not discovered after payslips go out.
Anomalies flagged pre-runSalaries credited across every city your team works from. PF, PT, TDS - all filed. Payslips and tax forms sent. Done before the deadline.
Full compliance in one clickBuilt for India's tech-industry payroll complexity - not general-purpose payroll software with an IT industry label added to the header.
FMV-based perquisite calculation, Section 192 TDS, and RSU vesting taxation - handled correctly at every exercise event.
Joining bonus, retention bonus, and performance payouts run inside the standard payroll cycle, with TDS recalculated on every revision.
PT applied per employee's registered work state automatically, even when your whole team reports to one office on paper.
Consultants and freelancers processed on a separate track with correct TDS, kept fully segregated from FTE payroll.
The bulk joining tool ensures that new employees are on the payroll on the very first day itself, with a process made for hiring campaigns rather than adding individual records.
Calculation of gratuity, leave encashment, notice pay recovery, and final TDS is done automatically within the prescribed time as per the Labor Code.
Form 16, ESOP statement, payslip, and PF balance are available through the mobile app-minimizing HR support calls drastically.
Role-based access on every payroll record and encrypted storage and role-based access on every payroll record are built for the security diligence tech companies face during fundraising.
Variable pay spend, FTE vs contractor cost split, and real-time payroll cost – CFO-ready dashboards, not month-end extracts.
Updated for the Income Tax Act 2025's ESOP provisions, Labour Code changes, and PT notifications - before the deadline, not after the notice.
Highlighted pills are IT and software-specific compliance requirements that generic payroll tools frequently get wrong or omit entirely.
Bulk onboarding means payroll never becomes the bottleneck in your hiring plan.
Practical guidance for HR and finance leaders running payroll for distributed, fast-scaling tech teams.
An honest comparison of HRMS platforms, including the specific attendance, variable pay, and compliance challenges unique to IT firms.
A feature-by-feature comparison of payroll platforms for startups, SaaS companies, and tech-enabled teams choosing their first or next system.
How HR automation supports rapid hiring, digital documentation, and payroll accuracy for fast-scaling IT and SaaS organisations.
The questions tech company HR heads and finance leaders ask before committing to a payroll system.
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Join 1,000+ businesses running accurate, compliant payroll for full-time employees, contractors, and ESOP holders on one platform - with multi-state PT and Section 192 TDS built in.
