ESIC Challan An Easy and Inclusive Guide for Employers in India

1. A Brief Introduction

Check in India every business with a growing team practice considering salary considerations and the welfare of employees as important. Herein comes ESIC (Employees' State Insurance Corporation), which ensures that medical, sickness, and maternity benefits are in favor of your employees.

But how contributions are tracked and managed? With something called ESIC Challan.

In this blog, we will guide you through the whole process What is ESIC, who must register, how to generate and pay for an ESIC Challan online, and how your business must maintain compliance. This guide is for startup founders and HR managers alike and is written in simple language that everyone would understand.

2. What is ESIC?

ESIC stands for Employees' State Insurance Corporation, a statutory body operating under the Ministry of Labour and Employment. Under the scheme, benefits such as medical care, maternity leave, and disability support are offered to employees earning less than a certain threshold.

Currently, establishments with 10 or more employees (most of the states) where workers earn ?21,000/month or less must go with ESIC registration. Monthly, the employer and employee make contributions.

3. What is an ESIC Challan?

An ESIC Challan is proof of payment made every month towards the ESIC scheme. It contains all pertinent particulars: employer code, the number of employees, wages, and total paid amount from employer and employees.

The challan is therefore generated after salary payment is made and has to be deposited each month. If not done, penalties may be applied and legal action initiated.

4. Who Should Register for ESIC?

Registration must be done for

·       Factories

·       Shops

·       Hospitals

·       Schools and educational institutions

·       Startups and companies with 10 or more employees (earning = ?21,000/month)

Documents Required for ESIC Registration:

·       Company PAN Card

·       GST certificate (if applicable)

·       Address proof of business

·       Employee details including Aadhaar, bank details and salary

·       Digital Signature (DSC) of employer

·       Registration can be made through the official ESIC Portal.

5. How to Generate an ESIC Challan Online

It is simple: Just follow these steps:

Visit: https://www.esic.in

1.      Log in using the Employer ID and Password.

2.      Visit the "Monthly Contribution?File Monthly Returns" link.

3.      Input the salary details for all insured employees.

4.      The system shall calculate the amount automatically.

5.      Press "Generate Challan."

6.      Download or print the payment receipt PDF.

Consecutively, this process will have to be repeated monthly after the salaries have been processed.

The ESIC Payment Process Online

·       Once the challan is generated, the payment can be made directly from the ESIC portal. 

·       Log in and visit the page "Pay Challan"

·       Select the relevant challan and click "Proceed to Pay"

·        Choose one of the payment modes: Net Banking, Debit Card, Credit Card, or UPI

·       Download the Acknowledgment Receipt after the payment succeeded.

·       It is highly recommended to pay before 15th of every month to avoid penalties. Reference RegisterKaro ESIC Guide

 ESIC contribution rate 2024

 Contributor Rate

·       Employer 3.25%

·       Employee 0.75%

·        Total 4%

·         For an example Employee whose monthly wage is ?20,000 Employer pays ?650 Employee pays ?150 Total ESIC Contribution is ?800 What Happens If You Miss the Due Date for ESIC Payments? The date for monthly ESIC Payments is 15th next month.

·       Late Payment Repercussions: Interest up to 12% per year on unpaid amount Penalties depending upon delay duration Loss of employee benefits such as medical, maternity, etc. Risk of inspection or legal notice by ESIC officers

How a CA can keep you compliant

Managing ESIC monthly filings is a daunting task not only for a small business but also for a growing business They will Register your company under ESIC Ensure correct monthly contributions Create and file ESIC challans on time Submit half yearly ESIC returns Handle any issues or disputes originating from the portal Preventing a lot of law complications and penalties

Pro guidance = Less tension + More compliance. Helpful Tools and Resources

•  ESIC UMANG Portal (For mobile access and updates)

•  ClearTax ESIC Filing Guide (For e filing guides)

•  BankBazaar ESIC Payment Guide

Q1. What is the due date for ESIC payment each month?

The 15th of the following month.

Q2. Can I make ESIC payments offline?

 No, ESIC payment is done only via online by the ESIC portal.

Q3. Should I register all employees under ESIC?

Only those whose monthly wages are Rs. 21,000 or less (Rs. 25,000 for disabled workers).

Q4. Can I modify a challan once generated?

 No. You need to cancel and create a new one.

Q5. Can a CA file my ESIC returns and handle payments?

Absolutely. A CA can manage your ESIC compliance end-to-end.

 Conclusion and Call to Action

 This is an act of government, but ESIC also creates a financial net for the employees during the crisis time. So timely payments of ESIC Challans, as a responsive and responsible employer, is not good business practice-it is the duty that must be accomplished.