Format of Salary Certificate and Sample Salary Certificate For Bank Loans

Authored By: Stanly Chirayath

In most of the cases salary certificate issues without a format. Salary Certificate letter contains some necessary information related to an employees' salary break-up including the tenure. Generally, Salary certificate uses for submitting to financial institutions sanctioning loan request made by salaried employee. It will give a basic assessment of an employees' repayment capacity prior sanctioning loan amount.

Break-up of salary certificate shall be in the following headers:

Salary Certificate

Gross Pay and Allowances (to be shown on Certificate of Salary):

1. Under this head, salary certificate form shows the amounts an employee is entitled to get, from the employer.

2. Salary certificate shows the Gross Salary amount, which will be the sum total of all the figures.

Deductions (to be shown on Certificate of Salary):

1. Under the Deductions head, salary certificate letter shows all the figures of sum that are required to be deducted from the salary, like Income Tax and other taxes to be deducted at source also known as TDS, installments of loans / advances repayable by the employee, provident fund contributions etc.

2. At the end of the section of the salary certificate letter, show the sum total of the deductions.

And finally, the Salary certificate must have net salary to be paid to the employee, which is the Gross Salary minus the Total Deductions. Attached image given explains the format of salary certificate issued for a car loan from bank. This Certificate of Salary shows gross earnings and deductions but not shown net earnings separately.

A sample Salary certificate image shown below:

Salary certificate format sample

The image below shows how essential data including photo to be shown in a proper Certificate of Salary:

Image of Sample Certificate of Salary

This sample Certificate of Salary letter shows Gross earnings, Total Deductions and Net Salary. Other important data shown in this format are: self attested photograph of the employee, designation, addresses, scale of pay, date of birth, date of joining, date of retirement and whether permanent or temporary. This Salary certificate can be considered as comprehensive and ideal sample salary certificate for any purpose. The download link has this Salary certificate form to be used for any purposes.

Occasions that Salary Certificate Required

When you apply for a bank loan, most of the banks ask you to produce some of the basic documents along with the loan application in which the important documents are: KYC documents (photo, address proof / Ration Card, ID proof, Passport), certificate of salary or salary certificate / latest salary slip showing all deductions and TDS certificate - Form 16 in case of you are a salaried person. Some of the offices have restrictions to issue certificate of salary more than once in a financial year. In such cases, photocopy of last certificate of salary, 3 months salary slips and TDS certificate would be the solution.


A simple Salary Certificate format is given below:

This is to certify that Mr./Mrs. - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - is working with us since "month dd, yyyy" and presently designated as - - -- - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - -- - --, his/her present residential address as per our records is - - - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - - -- - - -- and his/her salary emoluments for period of January 01, 2011 to March 31, 2011 are as mentioned as below:

Gross Emoluments

1. Basic Salary .......................: xxxx.xx

2. HRA ...............................: xxxx.xx

3. Allowance 1 .......................: xxxx.xx

4. Allowance 2 .......................: xxxx.xx

5. Special Allowance ..................: xxxx.xx

6. Conveyance .........................: xxxx.xx

-----------------------------------------------------------------

Gross Salary.................................: xxxxx.xx

Deductions

1. PF .................................: xxxx.xx

2. Loan 1 .............................: xxxx.xx

3. Loan 2 .............................: xxxx.xx

4. Others .............................: xxxx.xx

----------------------------------------------------------------

Total Deductions ..........................: xxxxx.xx

Net pay (Gross salary - Deductions) ............................: xxxxx.xx
In addition to above Mr. / Mrs. is entitled to bonus of Rs. ----------- and LTA of Rs. ------------. We hereby declare that we have deducted income tax of Rs. ------------- from Mr. / Mrs. --------------------------------------------- emoluments and same has been deposited in ------------------------ Bank branch.
This salary certificate is being issued to him on his --------------------------------------- request.

For company name

Authorised Signatory



Another Salary Certificate Format Having More Details:

Salary Certificate


The salary and other relevant particulars in respect of (Name) ......................................... (Designation) ....................................... (Department/Office) ................................. are certified, as furnished, below:

Date of birth: ..... (employee's date of birth) .....
Date of entry into service: ......(employee's start date of the present job).....
Date of retirement: .....(employee's retirement date)......
Scale of pay: ......(employee's present pay scale).....

Monthly Earnings (Rs.)

Deductions Recoveries (Rs.)

Basic pay:... (employee's basic pay)...PF Subscription.... (employee's PF subscription) ...
special pay:... (employee's special pay)...PF Loan... (employee's PF loan) ...
Dearness Allowance:... (employee's DA)...LIC... (employee's insurance premiums) ...
HRA:... (employee's HRA)...Welfare fund subscription... (employee's Welfare fund subscription) ...
CCM:... (employee's CCM)...Welfare fund loan... (employee's Welfare fund loan) ...
Interim Relief:... (employee's IR)...MCA... (employee's MCA) ...
Other Allowance:... (employee's other pay)...HBA/Rent and water charges... (employee's HBA/Rent and water charges) ...
....................................Co-op. Society... (employee's Co-op Society) ...
....................................Festival Advance... (employee's FA) ...
....................................Income tax... (employee's Income Tax) ...
....................................GIS... (employee's GIS) ...
....................................SLI... (employee's SLI) ...
....................................Other recoveries... (employee's other recoveries) ...
Total Rs.:..................Total Rs.... (employee's total) ...

Net salary Rs. ....................... (Rupees ....................................................................................).
This certificate is issued to .......................................... for the specific purpose of ............................................................ in response to the applicant's request dated ......................
 
 
Officer's Signature and stamp
Department

Image of Salary certificate template for bank loans

Download ready to use Salary Certificate Form here

The above salary certificate form can be used for submitting any type Bank loan availed in India. For example, Housing loan, Car loan, Personal loan, Credit card etc.

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Comments

Dear sir

I already taken a car loan using my slary ceritificate now i want to apply for a home loan. When i enquire it, iam informed that deductions will have car loan emi. sothat my eligibility for home loan is very low. In this condition how i will get maximum home loan amount?

Hi George,

When you think for a bank loan, Consider the following points:

  1. How much amount I require for the living expenditure without borrowing from other source. Normally Banks should know this point because, after taking loans from bank, you should not be starved or become a begger for your daily activities. Bank always calculate EMI/NMI ratio which should not be greater than a pre-defined value. Nationalized Banks normally take this value between 40 to 60 depending the Net Monthly Income. If you have higher NMI and has some liablities, Bank will further deduct that value from NMI.
  2. You change the payment method for car loan as cash payment instead directly deducting from the salary. This way you can hide your car loan liabilty from the salary certificate and increse the net earnings.

If you give your present liabilities, NMI, home loan duration, amount required and retirement date, I can precisely say how much amount you can avail for home loan.

Regards,

Admin

Nice post! Every employee should atleast read this post. Sample images describe all the details a salary template must have. Great work!

Hi Jerry,

Thanks for your comments.

Stanly

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