How to calculate Overtime Allowance based on Per Hour of Basic Pay (or Basic Pay and DA) in Tally ERP 9?

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To calculate the Overtime Allowance based on the Per Hour Basic Pay (or Basic Pay and DA) received, follow the steps given below:

  • Create/Alter Basic Pay Head
  • Create/Alter Over Time Hours as a Production Type
  • Create/Alter OT Allowance Pay Head
  • Define Salary Details
  • Record Attendance and Overtime details
  • Pass Payroll Voucher

 

Detailed steps:

Step 1: Create/Alter Basic Pay Head

For illustration purpose we have taken an User Defined calculation period of 30 days in each month

Create Alter Basic Payhead

Similarly, create DA Pay Head if required.

Step 2: Create/Alter Over Time Hours as a Production Type

Create/Alter Over Time Hours as a Production Type

Step 3: Create/Alter OT Allowance pay Head

Create the OT Allowance Pay Head as per the details shown in the screenshot.

OT Allowance Pay Head

Note: If DA is not applicable then the OT Allowance formula will have only Basic Pay component for the computation of OT.

The above Pay Head should not affect the Net Salary and hence the option is set to No

Basic Salary divided by total present days will give per day salary. Assuming that there are 8 Hrs in a day,

8 Hours = 100%

1 Hour = 12.50%

Note: In this case study 8 Hours is considered as working hours. In other cases the following table can be used to compute the Per Hour OT amount.

compute the Per Hour OT amount.

Step 4: Define Salary Details

Define Salary Details

Step 5: Record Attendance and Overtime details

Record Attendance and Overtime details

 Attendance

Step 6: Pass Payroll Voucher

Payroll Voucher

 

How to calculate Overtime Allowance based on Per Hour of Basic Pay (or Basic Pay and DA) in Tally ERP 9?
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