ESIC Registration, Rate, Return


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ESIC scheme

ESI stand for Employee State Insurance managed by ESIC (Employee State Insurance Corporation). ESIC code is a 17-digit unique number. ESIC scheme provide the various benefit to employee and his family members like medical, maternity (paid leaves) etc.

Applicability

The ESI scheme is applicable to all factories and other establishments (like Shops, Restaurants, Hotel, Cinema, Manpower supply services, Entertainment Industries etc.) as defined in the Act, with 10 or more persons employed in such establishment and the beneficiaries’ monthly wage does not exceed Rs 21,000 ( Rs. 25,000/- per month in the case of persons with disability) are covered under the scheme.

Documents required for ESIC registration

  • PAN Card, Aadhaar Card of employer and employees.
  • Registration certificate like Copy of GST registration, Company Incorporation certificate, Partnership Deed, Shop Act registration etc.
  • Memorandum of Association or Article of Association in case of company.
  • List of employees working the establishment
  • Copy of cancelled cheque.
  • Etc.

Rate of Contribution

The rates are revised from time to time, currently rate of contribution in ESIC is as below:

ParticularsRate (w.e.f. 01-07-2019)Rate (upto 30-06-2019)
Employer Share3.25%4.75%
Employee Share0.75%1.75%
Total4.00%6.50%

The ESIC is calculated on the gross salary of the employees whose salary below of Rs. 21,000/- (Basic Pay + DA + HRA + Overtime Allowance + All Any Other Allowance except Annual Bonus (such as Diwali Bonus), Retrenchment compensation and Encashment of leave and gratuity).

Employees in receipt of a daily average wage upto Rs.176/- are exempted from payment of contribution. Employers will however contribute their own share in respect of these employees.

ESIC Return & Payment Due Date

    • ESIC Return filling due date is on or before 15th day of every month.
    • ESIC payment due date is on or before 15th day of every month.

Contribution Period and Benefit Period

There are two contribution periods each of six months duration and two corresponding benefit periods also of six months duration as under.

Contribution Period Cash Benefit Period
1st April to 30th Sept. 1st Jan of the following year to 30th June
1st Oct to 31st March of the year following. 1st July to 31st December.

Example
If an employee’s gross salary increases in May from Rs. 20,000 (within ESI limit) to Rs. 25,000 (above ESI limit), the deductions for ESI will continue to happen till the end of the ESI contribution period i.e. September.
And the deduction amount for both the employee and employer will be calculated on the increased gross salary of Rs. 25,000.
At the end of the contribution period, if the employee salary is more than the ESI limit, no further deductions and contributions are required. The employee will still be covered under ESI till 30th June of the following year.
The same rules apply when an employee’s salary increases in the 2nd contribution period.


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