> For the complete documentation index, see [llms.txt](https://cyclone-nepal.gitbook.io/digital-hr-user-manual/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://cyclone-nepal.gitbook.io/digital-hr-user-manual/payroll/payroll-settings.md).

# Payroll Settings

1. **Salary Components:**
   * **Create Salary Components:** Define various elements of the salary such as basic pay, allowances (housing, transport), bonuses, and deductions (taxes, benefits contributions).
   * **Configuration:** Customize each component with specific calculation rules and percentages as needed.
2. **Salary Groups:**
   * **Create Salary Groups:** Group employees with similar salary structures together for easier management.
   * **Assign Components:** Assign salary components created above to each group to streamline the payroll process.
3. **Salary TDS (Tax Deducted at Source):**
   * **Set Up TDS:** Define the tax deduction rules as per local tax laws.
   * **Configuration:** Input the necessary percentages and thresholds to ensure accurate tax calculations.
4. **Overtime:**
   * **Configure Overtime Rules:** Set the criteria for overtime, including rates for different types of overtime (e.g., regular, double).
   * **Automatic Calculation:** Ensure the system calculates overtime based on these rules and integrates it into the payroll.
5. **Undertime:**
   * **Set Up Undertime Rules:** Define policies for undertime, where employees work less than their required hours.
   * **Deductions:** Configure how undertime affects salary, including any deductions or penalties.
6. **Payment Method Settings:**
   * **Define Payment Methods:** Specify the methods available for salary disbursement such as bank transfers, checks, or digital payments.
   * **Configuration:** Set up the necessary details for each payment method to facilitate smooth transactions.
7. **Advance Salary Percentage:**
   * **Set Advance Salary %:** Determine the maximum percentage of salary that employees can request as an advance.
   * **Mobile Application Integration:** Employees can request an advance salary through the Digital HR mobile app based on this predefined percentage.