IndPayroll

Choosing the right payroll software can save your business thousands of hours and lakhs of rupees annually. Both INDPayroll and Zoho Payroll are popular choices for Indian companies, but they take fundamentally different approaches to payroll processing. This comparison helps you decide which platform fits your specific needs.

Overview: Two Different Approaches

Zoho Payroll is part of the larger Zoho ecosystem — a general-purpose business suite that includes CRM, accounting, HR, and dozens of other modules. Payroll is one component among many. INDPayroll, on the other hand, is built exclusively for Indian payroll processing. Every feature, every compliance rule, and every interface decision is optimized specifically for Indian payroll needs.

Compliance & Statutory Coverage

Professional Tax

INDPayroll supports Professional Tax calculations for all 18 states that levy PT, including complex cases like Tamil Nadu’s half-yearly system and Maharashtra’s February catch-up payment. Zoho Payroll covers most states, but some employers report needing manual adjustments for edge cases in states such as Jharkhand and Assam.

PF & ESI

Both platforms calculate PF and ESI contributions correctly. However, INDPayroll generates ready-to-upload ECR files for the EPFO portal and ESI challans with zero formatting issues. Some Zoho Payroll users report needing to manually verify ECR file formats before uploading, especially for companies with complex wage structures.

TDS & Income Tax

Both platforms handle calculations for both the old and new tax regimes. INDPayroll allows employees to compare regimes side-by-side and switch during the declaration window. Form 16 generation is automated on both platforms, though INDPayroll includes Part A auto-filled from 26AS data for faster verification.

Pricing Comparison

Zoho Payroll starts at ₹40/employee/month for the standard plan, with the premium plan at ₹60/employee/month. INDPayroll charges ₹40/employee/month for all features — no tiered plans, no feature restrictions. For companies with under 10 employees, INDPayroll is completely free. Zoho Payroll offers a 30-day trial; INDPayroll offers an unlimited free tier for micro-businesses.

User Experience

Zoho Payroll’s interface follows the Zoho design language — functional but can feel complex due to deep integration with the Zoho suite. INDPayroll’s interface is designed exclusively for payroll, resulting in a cleaner, more focused experience. Payroll processing takes 3–5 clicks on INDPayroll versus 5–8 clicks on Zoho Payroll for the same operations.

Integration Ecosystem

Zoho Payroll’s biggest advantage is seamless integration with Zoho Books, Zoho People, Zoho CRM, and the broader Zoho ecosystem. If your business already uses Zoho products, Zoho Payroll connects naturally. INDPayroll offers API integrations with popular accounting software, including Tally, QuickBooks, and third-party HR tools, plus direct bank integrations for salary disbursement.

Support

INDPayroll provides dedicated support via phone, email, and WhatsApp with average response time under 2 hours. Zoho Payroll support is primarily email and chat-based, with phone support on premium plans. INDPayroll’s support team specialises exclusively in Indian payroll, while Zoho’s support covers the entire Zoho product suite.

Which Should You Choose?

Choose Zoho Payroll if you already use the Zoho ecosystem extensively and value tight integration between payroll, accounting, and HR in one vendor. Choose INDPayroll if you want a payroll-focused platform with deeper Indian compliance coverage, simpler pricing, faster support, and a purpose-built interface. For most Indian SMEs processing payroll for 10–500 employees, INDPayroll offers better value and compliance depth. Try INDPayroll free and compare for yourself.

More Comparisons & Resources

Also read: Best Zoho Payroll alternative in India, INDPayroll vs GreytHR, INDPayroll vs Keka HR. Check our payroll compliance checklist to understand what any payroll software must handle. See INDPayroll pricing.

TDS (Tax Deducted at Source) on salary is the income tax that your employer deducts from your salary before paying you. Under Section 192 of the Income Tax Act, 1961, every employer is required to deduct TDS when paying salary to an employee, if the salary exceeds the basic exemption limit. The deducted amount is deposited with the government and credited to the employee’s PAN.

Who is Liable to Deduct TDS on Salary?

Every person (individual, company, firm, trust, government body) who pays salary to an employee is liable to deduct TDS under Section 192. This includes:

• Private companies and LLPs
• Government departments (Central and State)
• Partnership firms
• Hindu Undivided Families (HUFs) if they have employees
• Trusts, societies, and NGOs

Income Tax Slab Rates for FY 2025-26 (AY 2026-27)

New Tax Regime (Default)

Standard Deduction: Rs. 75,000 | Rebate u/s 87A: Up to Rs. 25,000 (if total income ≤ Rs. 7,00,000)

Old Tax Regime (Optional)

Standard Deduction: Rs. 50,000 | All Chapter VI-A deductions (80C, 80D, etc.) available

Step-by-Step TDS Calculation on Salary

Here’s how employers calculate TDS on salary, demonstrated with an example:

Example: Employee with CTC ₹12,00,000/year (New Regime)

How TDS is Calculated Each Month

Employers don’t simply divide the annual tax by 12. The process works like this:

• April (start of FY): Estimate the employee’s total annual salary based on their pay structure
• Consider declarations: Account for investment declarations submitted by the employee (80C, 80D, HRA, etc.) under the Old Regime
• Compute annual tax: Apply the chosen tax regime’s slab rates
• Divide by remaining months: Spread the annual TDS equally across the remaining months
• Adjust monthly: If the employee submits additional proof or their salary changes (bonus, increment), recalculate for the remaining months
• February/March: Final reconciliation — any excess or shortfall is adjusted in the last month

TDS on Different Salary Components

Investment Declarations & Proof Submission

To reduce TDS, employees can submit investment declarations at the start of the financial year and proof of investments before January/February:

• Section 80C (up to Rs. 1.5L): PPF, ELSS, LIC premium, EPF, children’s tuition fees, home loan principal
• Section 80D: Health insurance premium — up to Rs. 25,000 (Rs. 50,000 for senior citizens)
• Section 80E: Education loan interest — no upper limit
• HRA Exemption: Rent receipts and landlord PAN (if rent > Rs. 1 lakh/year)
• Home Loan Interest (Section 24): Up to Rs. 2 lakh on self-occupied property
• NPS (Section 80CCD(1B)): Additional Rs. 50,000 deduction

Note: These deductions are available only under the Old Tax Regime. Under the New Regime, only the Standard Deduction and employer NPS (80CCD(2)) are available.

TDS Due Dates and Compliance

Common TDS Mistakes Employers Make

• Not updating regime choice: Deducting TDS under Old Regime when employee has opted for New Regime (or vice versa)
• Ignoring mid-year increments: Not recalculating TDS when salary increases due to appraisals or bonuses
• Wrong PAN in returns: Leading to TDS not reflecting in the employee’s Form 26AS
• Late deposit: Penalty under Section 234E (Rs. 200/day) and interest under Section 201(1A) (1.5% per month)
• Not considering previous employer salary: When an employee joins mid-year, their previous salary must be considered for correct TDS calculation

Automate TDS Calculation with INDPayroll

Manual TDS calculation across different regimes, variable pay, and mid-year changes is error-prone. INDPayroll handles it all:

• Dual regime support: Auto-calculate TDS under both Old and New Regimes based on the employee’s choice
• Investment declaration portal: Employees submit declarations and proof online
• Auto-adjustment: TDS recalculates automatically for increments, bonuses, and revised declarations
• Form 24Q generation: Auto-generate quarterly TDS returns ready for filing
• Form 16 generation: One-click Form 16 for all employees
• 26AS reconciliation: Match TDS deposits against Form 26AS data

Try INDPayroll Free Auto-calculate TDS on salary with 100% compliance.

Frequently Asked Questions

Can I choose between the Old and New Tax Regime every year?

Yes. Salaried employees can switch between the Old and New Regime every financial year. You need to inform your employer at the start of the year so they can deduct TDS accordingly. The final choice is made when filing your ITR.

What if excess TDS has been deducted?

If more TDS is deducted than your actual tax liability, you can claim a refund when filing your Income Tax Return. The refund is processed by the Income Tax Department, usually within 1-3 months of ITR processing.

Is TDS deducted on the notice period recovery amount?

Yes. If an employee pays notice period recovery (buy-out), the employer should reduce it from the gross salary before computing TDS. However, practices vary — clarify with your employer and CA.

What is the TDS rate if PAN is not provided?

If an employee does not provide PAN, TDS is deducted at the rate of 20% or the applicable slab rate, whichever is higher (Section 206AA).

Related Payroll Resources

TDS calculation is closely tied to your income tax regime choice. Read our income tax slabs 2026-27 comparison to understand the impact on your employees. Also see how to generate Form 16, HRA exemption calculator, and our payroll compliance checklist for TDS filing deadlines. Automate TDS deductions with INDPayroll — see pricing.

Professional Tax (PT) is a state-level tax levied on individuals earning income from salary, profession, trade, or business. It is governed by Article 276 of the Indian Constitution, which caps the maximum professional tax at Rs. 2,500 per year. Not all states in India levy professional tax — only specific states and union territories impose it.

Employers are responsible for deducting professional tax from employees’ salaries and remitting it to the state government. Self-employed professionals must pay it directly.

States That Levy Professional Tax in India

As of 2026, the following states and union territories levy professional tax: Maharashtra, Karnataka, West Bengal, Andhra Pradesh, Telangana, Tamil Nadu, Gujarat, Madhya Pradesh, Kerala, Assam, Meghalaya, Tripura, Odisha, Jharkhand, Bihar, Sikkim, Manipur, and Mizoram.

States like Delhi, Uttar Pradesh, Rajasthan, Haryana, Punjab, and Uttarakhand do not levy professional tax.

Professional Tax Slab Rates — State-Wise (2026)

Maharashtra Professional Tax

Maximum annual PT: Rs. 2,500. Note: In February, PT is Rs. 300 to make the annual total Rs. 2,500.

Karnataka Professional Tax

West Bengal Professional Tax

Andhra Pradesh Professional Tax

Telangana Professional Tax

Tamil Nadu Professional Tax

Note: Tamil Nadu levies PT on a half-yearly basis (April-September and October-March).

Gujarat Professional Tax

Madhya Pradesh Professional Tax

Kerala Professional Tax

Professional Tax Compliance for Employers

• Registration: Employers must register for PT with the respective state’s tax authority within 30 days of hiring employees
• Deduction: PT must be deducted from employees’ salaries every month
• Payment: Deducted PT must be remitted to the state government by the prescribed due date (usually by the end of the following month)
• Returns: Annual/periodic PT returns must be filed with the state authority
• Penalty: Late payment attracts interest (typically 1-2% per month), and penalties vary by state

Professional Tax Deduction in Income Tax

Professional tax paid is fully deductible under Section 16(iii) of the Income Tax Act, both under Old and New Tax Regimes. This means the Rs. 2,500 maximum PT reduces your taxable income. The deduction is available irrespective of which tax regime you choose.

How INDPayroll Handles Professional Tax

Managing professional tax across multiple states with different slabs is complex, especially for companies with employees in multiple locations. INDPayroll simplifies this:

• Auto-detect state: PT slab is automatically applied based on the employee’s work location
• Multi-state support: Handle employees across Maharashtra, Karnataka, West Bengal, and all PT-levying states from one dashboard
• Automatic calculation: PT is calculated every pay cycle based on the latest state slabs
• Return filing support: Generate PT return data in the format required by each state
• Rate updates: Slab rates are updated whenever states revise their PT schedules

Try INDPayroll Free → Auto-calculate Professional Tax for employees across all Indian states.

Frequently Asked Questions

Is Professional Tax the same in all states?

No. Each state sets its own PT slab rates and rules. The only common limit is the constitutional cap of Rs. 2,500 per year. Some states like Tamil Nadu and Kerala levy PT on a half-yearly basis, while others deduct monthly.

Do freelancers and self-employed professionals need to pay PT?

Yes. Self-employed individuals, freelancers, doctors, lawyers, CAs, and other professionals must register and pay PT directly to the state government if they practice in a state that levies PT.

Can I claim Professional Tax refund?

PT is generally non-refundable. However, if PT has been incorrectly deducted (e.g., deducted in a non-PT state), you can apply for a refund from the concerned state authority.

What happens if my employer doesn’t deduct PT?

The employer faces penalties and interest for non-compliance. The liability remains on the employer, not the employee. However, it’s good practice to verify PT deduction on your salary slip.

State-Wise Professional Tax Guides

For detailed state-specific PT information, read our dedicated guides: Maharashtra Professional Tax, Karnataka Professional Tax, Tamil Nadu Professional Tax, AP & Telangana Professional Tax, and Gujarat, West Bengal, MP, Kerala & other states. Auto-calculate PT in every state with INDPayroll — see pricing.