Dearness Allowance (DA)
Definition
A cost-of-living adjustment paid to employees, chiefly in the Indian public sector, calculated as a percentage of basic pay and revised periodically to offset inflation.
Related Terms in Payroll
Leave Travel Allowance (LTA)
An allowance Indian employers pay to cover an employee's travel costs within the country, which can be exempt from tax subject to conditions and limits under the old tax regime.
Form 12BB
A declaration an Indian employee gives their employer of the deductions and allowances they intend to claim — such as HRA, LTA and investments — so the employer can compute TDS on salary correctly.
Full and Final Settlement
The process of settling all dues when an employee leaves — unpaid salary, leave encashment, gratuity and any recoveries — in a single closing calculation. It clears both parties' outstanding obligations.
Payroll Tax
Taxes and contributions levied on wages, which may be withheld from employees, borne by employers, or both. They typically fund social-security and related programmes.
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