Basics of Employees State Insurance

Employees who are earning INR 21,000 per month or less they are eligible under ESI Act 1948.

ESI employer contribution is 4.75% and employee contribution is 1.75% and the total percentage is 6.50%.

 

 

The wage ceiling under ESIC Act 1948 has been increased from INR 15,000 to INR 21,000 and this change will applicable from 1^st January 2017.

 

 

 

 

 

Employees who are registered under the ESI scheme, they all are permit for medical treatment for themselves and their dependants.

 

The last wage ceiling hike was during the financial year 2010 – 2011 ESIC has been increased wage ceiling from 10,000 to 15,000 with effective from 1st May 2010

 

 

ESI Calculation

 

 

You have to pay ESI before the 21^st of the following month, example, due date for ESI payable for the month of April 2017 is before 21^st of May 2017.

 

 

ESI related accounting entries

 

Salaries A/c Dr

 

To ESI employees contribution A/c

 

To PF employees contribution A/c

 

To Professional Tax A/c

 

To TDS A/c

 

To Salaries Payable A/c

 

 

ESI Payment entry

 

ESI employees contribution A/c (1.75%) Dr

 

ESI Employer contribution A/c (4.75%) Dr

 

To Bank A/c

 

 

 

 

Related Topics

 

Basics of Employee Provident Fund

 

TDS Refund