Why is a small difference in tax from one month to the next?

Tax and other statutory deductions are calculated on a daily basis and not monthly except for deductions with ceilings. If an employee works for a period shorter than a full financial year, the tax authority calculates the tax deduction based on the period worked based on days and not months. Other software tries to make the tax deduction as constant as possible from one month to the next. Although this is convenient, in many cases where an employee is terminated before the end of the financial year on the other software an adjustment is made to the tax deduction and if the employee was already paid their final salary, either the employer or employee is short-changed. We believe every cent counts and thus do not want such short-changed issues. You have the option to change this in the company profile.

Updated at 2025-10-08 10:00:00

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