Salary structure in India has earning and deductions as major components. Earnings is the total compensation earned by an employee and paid by the employer in exchange for the service provided by an employee which is calculated on payroll during the accounting period. Earnings include wages, salaries, and overtime pay.
Earnings and Deductions function to calculate the net salary or take-home salary of an employee. Earnings are the amount that is earned by an employee and deductions is the amount that is deduction by the employer in form of taxes, insurance premium, and other deductions.
All the earnings are positioned on the left hand of a salary slip of an employee and deductions are usually shown on the right-hand side of a salary slip.