Monthly Statutory Compliance
Monthly statutory compliance
Monthly statutory compliance refers to the legal obligations that businesses and employers must fulfill on a monthly basis to ensure compliance with various labor, tax, and regulatory requirements. These obligations may vary from one country to another and can also depend on the specific industry and size of the business. Here are some common monthly statutory compliance tasks that businesses often need to address:
1. Payroll and Tax Deductions:
•Calculate and deduct income tax, Social Security contributions, Medicare contributions, and other payroll taxes from employee salaries.
•Deposit these withheld taxes and contributions to the relevant government agencies by the specified deadlines.
•Issue paychecks or process direct deposits for employees.
2. Employee Benefits and Contributions:
•Deduct and remit employee contributions for benefits such as health insurance, retirement plans, and other fringe benefits.
•Ensure that employer contributions to these benefits are made on time.
3. Payment of Vendor Bills and Invoices:
•Pay bills to vendors, suppliers, and service providers according to agreed-upon payment terms.
4. Goods and Services Tax (GST)/Value Added Tax (VAT):
•Calculate and remit GST/VAT based on sales and purchases during the month.
•File monthly GST/VAT returns with the tax authorities.
5. Employee Provident Fund (EPF) and Employees’ State Insurance (ESIC):
•Deduct EPF and ESIC contributions from employee salaries.
•Deposit these contributions along with employer contributions to the relevant authorities.
•File monthly returns and reports related to EPF and ESIC.
6. Professional Tax:
•Deduct and remit professional tax from employee salaries (in some Indian states).
•File monthly or quarterly professional tax returns.
7. TDS (Tax Deducted at Source) Compliance:
•Deduct TDS from payments made to vendors, contractors, or professionals as required by tax laws.
•File TDS returns and provide TDS certificates to payees.
8. Employee Attendance and Leave Records:
•Maintain accurate records of employee attendance, leaves taken, and overtime worked during the month.
9. Labor Law Compliance:
•Ensure compliance with labor laws, including minimum wage requirements, overtime regulations, and working hours.
10. Financial Reporting:
•Prepare monthly financial statements, including the income statement and balance sheet.
•Review and reconcile accounts to ensure accuracy.
11. Insurance Premiums:
•Pay insurance premiums for business insurance policies, such as liability insurance or workers,
compensation insurance.
12. Safety and Environmental Compliance:
•Comply with safety and environmental regulations,including reporting of any incidents or accidents.
13. Record Keeping:
•Maintain records and documentation related to financial transactions, payroll, taxes, and compliance activities.
14. Statutory Filings:
•File any other monthly statutory reports or filings required by industry-specific or local regulations.
•It’s important for businesses to stay informed about the specific statutory compliance requirements applicable to their location and industry. Non-compliance with statutory requirements can lead to penalties, legal issues, and damage to the reputation of the business. Many businesses use specialized software or hire external experts, such as accountants or HR professionals, to help ensure they meet their monthly statutory compliance obligations accurately and on time.