Salary Certificate – Format, Template and Uses

What is a salary Certificate?

A salary certificate is a document through which a company records the income that an employee receives from its workforce, as well as the time he/she has been working for the company.

Salary certificate is written in the form of a letter and is released at the request of an employee. The employer is required to release such a document to its employee when requested.

While many companies have their Way of keeping records about its employees, it is important to know what to include.

In this post you will see a step-by-step example of what to include in a salary certificate.

What is need of Salary Certificate?

As mentioned above the salary certificate is a document that employees of private and public companies can request from their administration.

Some examples of cases where salary certificate may be required are:

  • Applying for a Loan
  • Applying for a scholarship
  • Purchasing a home or vehicle
  • Paying alimony

The salary certificate may contains multiple data related to both the company and the employee.

With the help of this salary certificate, these entities can easily verify that you work for a company and how much salary you withdraw from that particular company which is mentioned in detail in this document.

Salary Certificate is normally printed on the letterhead of a company, but this is not a mandatory requirement. If the company from which salary certificate is requested is an established company, then in additon to the signature of the employer, it must have the stamp of that company.

What to include in salary certificate:

While making a salary certificate, you must ensure that it contains the following information and data mentioned clearly.

  1. Date and Location
  2. Employee’s name
  3. ID number
  4. Date of hiring
  5. Position held
  6. Gross salary (Monthly and Annual)
  7. Deduction information
  8. Income tax information
  9. Company name and contact information
  10. Company stamp (if available)

How to get a salary certificate:

Mainly the human resource manager is responsible for creating employee’s salary certificates within a company. Salary information is often kept private, so you cannot ask your immediate supervisor to create this type of documentation. If you work in a small company that does not have a human resource manager then it is the responsibility of the owner to provide salary certificate to employees on request.

Benefits and uses of salary certificate:

There are many cases places where you may need a salary certificate. Below are some examples:

Applying a new job:

While applying for a job it may be very usefull if you have a salary certificate which lists information on your total gross income, information of your residence and more. In most cases, the salary certificate has a date and is valid for few months or for maximum one year only. When you joins a new job or gets promoted, then it will be very useful to have a salary certificate included with other documents. By having a salary certificate will helps you to negotiate between between previous and new company. If you apply for a new job and looking to do salary negotiation, then here comes the need of salary certificate.

Applying a Loan:

If you apply a loan from a bank or any other financial organization, then they will surely demand salary certicate from you before approving a loan. With the help of salary certificate, these entities can make sure that how much salary the client gets and whether he/she will be able to recover the amount of loan or not. The salary certificate by these banks or financial organization can requested from the client or directly from the company in which he works.

Other Places 

Salary certificate may also be needed if you compete in an election or if you have a charity service.

Salary Certificate Template

In most cases the company you works for, has its own salary certificate format and template which is printed on the company’s letter head. But sometimes this format does not containes all the information you need to have in it. So you can request the company or employer to issue the salary certificate on a different page which has customized format and includes all the necessary information and data you want.

If company refuses to give Salary Certificate

For reasons not always understandable, the company may refuse to provide the salary certificate . In these cases how do you behave? Even if the employer cannot refuse to produce and issue the salary certificate, it often happens that the worker passively suffers this decision in order not to break relationships with his employer.

Sometimes a company may not want to issue the salary certificate to its employees for unknown reasons. So in such cases how can we get a salary certificate? In such situtations employees can demand service certificate from his/her employer. Service certificate is a document issued by a company to its employees and in this document the company or employers declares that the worker is employed by him with a fxed-term employment contract or undetermined, works regularly and has no ongoing disciplinary action.

Difference between salary certificate and income certificate:

The main difference between salary certificate and income certificate is that, the salary certificate is requested by an employee from his/her company or employer and it contains data about Employee and some information about the employer only. Whereas the income certificate lists the income of a person from any source and not necessarily from a job.

Difference between salary certificate and Salary Slip

The most common difference between salary slip and salary certificate is that, the salary slip lists the salary of an employee for a particular month. On the other hand in salary certificate the Annual Gross salary of an employee or the total salary on which the employee was hired is mentioned in detail.

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