Payroll · September
Illustrative- T−5Inputs lockedDone
Joiners, leavers, attendance and variable pay final. Payroll run.
- T−3Accounts checked2 fixed
New and changed bank accounts verified; mismatches back to HR.
- T−2Approved and fundedDone
Payroll register approved; funds in place for the net total.
- T−1ReleasedSent
Salary batch sent, so NEFT credits land before the morning.
- PayPayday morning1 re-paid
Every row processed? Failed rows re-paid by IMPS today.
- T+1ClosedClosed
Register, statuses and bank statement agree. Payslips out.
Salary payments · payroll guide
Everyone paid, on the morning of payday
Employees judge payroll by one thing: their bank app on payday morning. Getting there is a countdown that starts days earlier. This guide walks through it, and through what to do for the one employee whose salary didn't arrive.
- Payroll calculates; the payment only moves net pay.
- Most failures are bank details that changed.
- Amounts are confidential from upload to report.
A salary is just a payout. Payday is what makes it hard.
Underneath, a salary credit is an ordinary transfer from your account to an employee's, on one of India's bank rails. What makes payroll different is everything around it: a fixed day that everyone is watching, hundreds of amounts that must stay private, bank details that change quietly, and statutory deductions that have to be right before any money moves.
Salaries are usually sent as a batch; the mechanics of preparing, releasing and retrying a batch are in the bulk payout guide. This page covers what's specific to payroll.
The payroll countdown, day by day
T is payday. The exact number of days depends on your payroll size; the order doesn't.
- T−5
Lock the inputs
Joiners, leavers, attendance, overtime, reimbursements and variable pay are final. After this, changes wait for next month or an off-cycle run. Payroll is calculated and deductions applied.
- T−3
Check the accounts
Every employee paid for the first time, and anyone whose bank details changed since last month, is verified. A mismatch goes back to HR now, not on payday. Accounts that were paid successfully last month rarely need re-checking.
- T−2
Approve and fund
The payroll register is reviewed: headcount against last month, total against last month, and any unusually large amounts explained. A second person approves. Funds for the net total, plus fees, are in place.
- T−1
Release
The salary batch is sent. NEFT runs in half-hourly batches through the day and night, so credits sent the day before are normally in accounts by morning. Some employers release on payday itself using faster rails.
- Payday
Confirm, then fix the few
Check that every row is processed. Rows still pending are watched, never resent. Failed rows are fixed with the employee and re-paid the same day on a rail that credits immediately, such as IMPS.
- T+1
Close
The payroll register, payment statuses and the bank statement agree for every employee. Payslips go out. Anything still open has a named owner.
NEFT timing is from RBI's NEFT FAQs. Which rails are live on your account is confirmed during onboarding.
Employee bank details: where payroll usually breaks
Most failed salary credits have the same cause: the employee changed banks, closed an account, or gave details with a typo when they joined. The second most common problem is worse: someone else changed them.
Salary-diversion fraud looks like an ordinary HR request: an email, apparently from an employee, asking for salary to go to a new account. The employee finds out on payday.
Take changes only through a channel the employee is logged into. An HR system or portal, not email or chat.
Verify the new account. Confirm it exists and the name fits the employee before saving it. See bank account verification.
Tell the employee on their old contact details. A short confirmation that their account changed lets them object if they didn't ask.
Set a cut-off. Changes after a set day apply from next month, so every change is checked before it's paid.
Salaries are the most sensitive file you send
A payroll file lists what every person in the company earns. It gets exported, uploaded, approved and reported on, and every one of those steps is a chance for it to end up in the wrong inbox.
Few hands
Only the people who prepare and release payroll can see amounts.
No email
Files move through systems with access control, not attachments.
Quiet narration
The statement description says it's salary, not what makes it up.
Reports by role
Downloads of payment reports are limited and logged.
Which access controls are built into your Peneu setup is confirmed during onboarding.
One salary didn't arrive. Now what?
On payday, speed matters more than anything else. The employee has rent, EMIs and bills due. The order below gets them paid today without paying them twice.
If it shows processed
The money left and the receiving bank accepted it. Share the bank reference (UTR) with the employee so their bank can trace it. Don't pay again.
If it shows pending
The bank hasn't answered yet. Tell the employee it's in progress, and check the status until it's final. Paying again now risks paying twice.
If it shows failed
Read the reason. Get corrected details through the usual verified channel, verify the account, and re-pay the same day on a rail that credits immediately.
A salary can be accepted and then returned by the employee's bank, sometimes a day or more later. The money comes back to you and the row changes to returned. Handle it like a failure: confirm new details, then re-pay.
Payments outside the monthly run
| Payment | When it happens | What's different |
|---|---|---|
| Full and final settlement | After an employee leaves | Includes dues and recoveries; the account may be closed soon, so verify it |
| Joiner's first salary | Joined after the input lock | First payment to a new account: verify before paying |
| Bonus or incentive | Quarterly or annual | Often large; may need a separate approval |
| Reimbursements | Weekly or monthly | Not salary; usually tracked against claims, not payroll |
| Salary advance | On request | Recovered from later salaries; keep the approval on file |
From payroll register to payment file
Payroll software produces a register with dozens of columns: earnings, deductions, employer contributions. The payment file needs only a few of them. Everything else stays in payroll, which is also how you keep salary structures out of the payment system.
| Reference | Employee | Account | IFSC | Net pay (₹) | Narration |
|---|---|---|---|---|---|
| SAL-2609-0001 | E1042 · A. Nair | ••••7310 | ABCD0001234 | 48,215.00 | Salary Sep |
| SAL-2609-0002 | E1043 · R. Qureshi | ••••0452 | EFGH0005678 | 61,930.00 | Salary Sep |
| SAL-2609-0003 | E1051 · S. Pillai | ••••9981 | IJKL0009012 | 39,480.00 | Salary Sep |
Names, accounts and IFSC codes are made up. The exact columns and formats Peneu accepts are confirmed during onboarding.
Reference per employee per month
So a re-payment of the same month's salary is recognisably the same obligation, not a second salary.
Employee ID, not just a name
Two people can share a name; an ID can't be confused.
Net pay only
Gross, deductions and components stay in payroll, where they belong.
When payday falls on a Sunday or a holiday
The rails themselves no longer stop: RBI's FAQs describe NEFT and RTGS as available round the clock on every day of the year, and IMPS and UPI also run at any hour. So a salary can be credited on a Sunday.
What usually doesn't run on a holiday is your own side: approvers, the finance team, and sometimes the bank processes that fund your payout account. That's why most employers decide in advance whether a holiday payday moves earlier, and keep that rule the same every year so employees know what to expect.
Pay early. Release on the last working day before the holiday. Employees are paid early; nobody is paid late.
Pay on the day. Approve and fund on the working day before, release so credits land on the holiday itself.
Pay after. Rarely a good idea for salaries: employees have payments due on the date they expect.
What to tell employees, and when
Most salary queries are avoidable. A few short messages at the right moments answer them before they're asked, and make the one real problem easier to spot.
When they join
Which details you need, how to change them later, and your cut-off for changes before payday.
After a bank change
A confirmation, sent to their old contact details as well, that their salary account has changed.
On payday
Salary credited, with the date. Payslips when they're ready.
If theirs failed
A direct message: what happened, what you need from them, and when it will be re-paid.
Paid too much, too little, or twice
Payroll mistakes happen: a wrong attendance figure, a bonus entered twice, a batch uploaded again after a timeout. The payment side can't undo them. A salary credit that reached an employee's account can't be pulled back by you or your provider.
Underpayments are easy: pay the difference in an off-cycle payment as soon as it's found, and tell the employee why. Overpayments and duplicates need care. Recovering them, usually by agreement or through a later payroll, is an employment and legal matter, so involve HR and your adviser and get the employee's agreement in writing.
Duplicates are the preventable one. A unique reference per employee per month means a re-uploaded file is caught instead of paid.
Reconcile before the next run. An error found at month end is cheaper than one found in three months.
Keep the correction linked. The difference payment or recovery should point to the original month's payment.
What payroll does, and what the payment does
It helps to keep two jobs apart. Payroll works out what each person is owed: gross pay, deductions, and net pay. The payment moves the net pay into the employee's account. Statutory contributions and tax withheld are paid separately to the relevant authorities, through their own processes and deadlines.
Which deductions apply to your employees, and how and when they're deposited, is a question for your payroll or tax adviser, not for a payment provider.
Payroll
- Gross pay and allowances
- Statutory deductions
- Tax withheld
- Net pay per employee
- Payslips
Payment
- Net pay to each account
- The rail and timing
- Status per employee
- Bank reference for each credit
- Failures and re-payments
Closing payroll: three counts that must agree
Before a payroll month is closed, the number of employees and the total net pay should agree across three records. When they don't, the difference is almost always a failed or pending row that hasn't been dealt with.
Payroll register
412 employees · net total as approved
Payment statuses
410 processed · 1 re-paid by IMPS · 1 pending
Bank statement
Debits for 411 credits so far
Illustrative. Here one row is still pending, so the month isn't closed yet. See reconciliation.
Contractors, freelancers and gig workers
People who aren't employees are paid differently: usually against an invoice or completed work, often weekly or daily, and more often to a UPI ID. There's no payday to hit, but there are many more, smaller payments, and bank details change more often. The same rules apply: verify new accounts, never resend a pending payment, and keep one reference per payment.
Payouts guideFreelancers and individual businessesLogistics and delivery
Connecting payroll to payouts
Most payroll errors that reach employees happen at the join between two systems: payroll calculates, something exports a file, someone uploads it, and the results come back by email. Every manual step in that chain is a place where a row is dropped, duplicated or changed.
Whether you connect them with a file or directly, the principles are the same: the payment side should receive exactly what payroll approved, keep its own reference for each row, and send each row's final status back to payroll so the register shows who was paid, not just who was due.
One source of truth
Net pay per employee comes only from the approved payroll register, never re-typed.
A reference per employee per month
So a re-sent file is recognised, not paid twice.
Totals checked on arrival
Row count and total must match what payroll approved before anything is released.
Statuses back to payroll
Processed, failed or returned per employee, so HR can answer questions from one screen.
Returns handled as events
A salary that comes back is linked to the original row and re-paid with a new reference.
Salary payment questions
Questions employees ask HR
- Why did my colleague get paid before me?
- Salaries in one batch are separate transfers, and they can reach different banks at slightly different times depending on the rail and the receiving bank. A difference of a few hours on payday is normal; a salary that hasn't arrived by the end of payday is worth asking HR about.
- Can my salary be paid to someone else's account?
- Most employers pay only into an account in the employee's own name, and verify the name before the first payment. If you need an exception, ask HR; don't expect it to be allowed.
- It's payday and my salary hasn't arrived. What should I check?
- Ask HR or payroll whether your payment shows as processed, pending or failed. If it's processed, they can share the bank reference (UTR) for your bank to trace it. If it failed, the usual cause is a changed or closed account; you'll be asked to confirm your details before it's paid again.
- Why does my salary credit show a different description from last month?
- The narration on your statement is set by your employer and the bank that sent the payment. It can change if the employer changes banks or payment providers. The amount and the sender name are what to check.
- I changed my bank account. When will my salary go to the new one?
- From the first payroll after the change has been confirmed and verified. Many employers cut off changes a few days before payday, so a change made the day before is often applied the following month.
Questions finance teams ask
- Should the payroll bank account be separate from the operating account?
- Many businesses use a separate account, funded shortly before payday, so salaries can't be delayed by other payments and payroll access can be limited to the people who need it. It's a control choice, not a requirement of the payment itself.
- Can we pay employees in more than one instalment a month?
- Yes. The payment side doesn't limit how often you pay; each run is a separate batch. The pay frequency itself is an employment and payroll decision, and each instalment should carry its own reference.
- We have several legal entities. Can payroll run from one place?
- Each employing entity usually pays its own employees from its own account, so each needs its own batch, funding and records, even if one team runs them all. Keep entity and employee IDs on every row so nothing crosses over.
- How early should the salary batch be released?
- Early enough that every credit lands before employees check on payday morning, which usually means releasing the day before when paying on NEFT, and leaving time to re-pay any failed rows by IMPS during payday itself.
- Can salaries be paid by UPI?
- Payouts can go to UPI IDs, but most payroll pays to bank accounts because account details are more stable and easier to keep in employee records. Which rails are live on your account is confirmed during onboarding.
- Does a salary payment deduct PF, ESI or TDS?
- No. Deductions are calculated in payroll, and the payment moves the net pay. Statutory contributions and tax are paid separately to the relevant authorities through their own processes. Which deductions apply to your employees is a question for your payroll or tax adviser.
- How do we keep salary amounts confidential?
- Limit who can see or download the payroll file and payment reports, keep amounts out of email, and separate the person who prepares the batch from the one who releases it. Whether Peneu's reports can be restricted by role is confirmed during onboarding.
- Is a salary payment different from paying contractors?
- The payment itself is the same kind of transfer. The difference is around it: salaries come from payroll with statutory deductions and a fixed payday, while contractor payouts are usually invoice- or task-based, more frequent and often to UPI IDs.
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Official sources
Last reviewed . Examples, amounts and screens marked illustrative are not Peneu figures.