Payroll software for India and payroll software for the UAE solve two different problems. In India the hard part is statutory deductions that change by state and by notification. In the UAE there is no income tax to deduct, but salaries must move through the Wage Protection System on time, and end-of-service gratuity is a liability that grows every month. If you employ people in both countries, you have both problems at once. This guide covers what any payroll software has to get right in each country, and what to ask before you buy.
India: What Payroll Software Must Calculate
An Indian payroll run is a stack of rules on top of gross pay. Good software keeps those rules as configurable rule sets with effective dates, because they change, and two of them changed recently.
| Component | What the software has to handle |
|---|---|
| EPF | 12% employee and 12% employer contributions on PF wages, split across EPF and EPS. The statutory wage ceiling was raised from ₹15,000 to ₹25,000 a month from 17 September 2026, as widely reported, so September 2026 needed a split calculation. |
| ESI | 0.75% employee and 3.25% employer on gross wages, for employees within the ESI wage limit (₹21,000 a month for most employees). |
| Professional tax | Set by each state, with slabs and frequencies that differ; the Constitution caps it at ₹2,500 a year. Tamil Nadu, for example, collects it half-yearly. |
| TDS on salary | Monthly income-tax deduction under Section 192, under the old or new tax regime (the new regime is the default), with declarations and proofs. |
| Returns and forms | ECR files for EPF, ESI returns, the quarterly Form 24Q and the annual Form 16 for every employee. |
The bigger structural change is the Labour Codes, which took effect on 21 November 2025. Under the new definition of wages, allowances above half of total pay are added back into "wages" for statutory purposes. For companies that kept basic pay low and allowances high, that changes gratuity, bonus and leave calculations, and may change how salaries should be structured. Payroll software that cannot model a salary structure against the 50% rule leaves that work in a spreadsheet.
Rules change faster than software releases. Before you trust any payroll product, ask how quickly it applied the September 2026 EPF ceiling change and the Labour Codes wage definition, and whether you can see the rule versions it used for a past month. Always confirm the current figures against the EPFO and ESIC notifications; this article describes the rules, it is not legal advice.
The UAE: What Payroll Software Must Handle
UAE payroll looks simpler because there is no personal income tax. In practice, compliance sits in three other places.
The Wage Protection System (WPS). Private-sector salaries registered with the Ministry of Human Resources and Emiratisation (MOHRE) are paid through WPS, using a salary information file (SIF) submitted through a bank or an approved agent. Ministerial Resolution No. 340 of 2026 replaced the earlier rules from 1 June 2026: according to EY and Deloitte's summaries, wages are due by the first day of the following month, and an employer counts as compliant when at least 85% of the wages due are paid by that deadline. Your payroll software should produce the SIF in the format your bank accepts, and flag late or partial runs before MOHRE does.
End-of-service gratuity. Under Federal Decree-Law No. 33 of 2021, gratuity is 21 days of basic pay for each of the first five years of service and 30 days for each year after that, with the total capped at two years' pay. The daily rate is usually worked out from basic monthly pay divided by 30. Good software accrues this every month, so the liability is never a surprise when someone leaves.
Everything around pay. Leave and air-ticket entitlements, pension contributions for UAE and GCC nationals, and pay elements that differ by visa and emirate all live in the same run.
Check the primary source. WPS deadlines and penalties are set by MOHRE resolutions, and the 2026 resolution changed them. Confirm the current rules on mohre.gov.ae or with your bank before relying on any vendor's summary, including this one.
India vs UAE, Side by Side
| India | UAE | |
|---|---|---|
| Income tax on salary | Yes: TDS every month, old or new regime | No personal income tax |
| Social security | EPF and ESI for most employees | Pension contributions for UAE and GCC nationals |
| How salary is paid | Bank transfer; no central wage system | Through WPS, by the first of the following month |
| Biggest hidden liability | Gratuity and leave under the new wage definition | End-of-service gratuity |
| What changes most often | Ceilings, state professional tax, tax slabs | MOHRE rules and deadlines |
If You Run Payroll in Both Countries
Companies with an Indian entity and a UAE entity usually end up with two payroll tools, two sets of reports and a spreadsheet in between. The questions that matter for a two-country setup are different from a single-country one:
INR and AED in one place
Separate pay groups per currency, with consolidated reporting across entities
A locked, auditable run
Inputs locked before calculation, approvals recorded, nothing edited after payment
Rule sets with dates
Statutory rates you can update, with history for every past month
Self-service on the phone
Payslips, leave and tax declarations without emailing HR
This is the problem we built Growbzpayroll for: payroll for multi-entity companies in India and the UAE, with INR and AED pay groups in the same account, an eight-stage run (configure, inputs, lock, calculate, review, approve, finalize, pay), statutory rates and returns kept as rule sets, and employee self-service on the phone. You can see it on our work page.
How to Choose Payroll Software
Whether you are comparing well-known SaaS products or a custom build, run every candidate through the same five questions:
- Can it show me a past month exactly as it was paid? If a rate changed since, you should still see the old one on the old payslip.
- How are statutory changes delivered? Automatically, by a support ticket, or by you editing a formula?
- What files does it produce? In India: ECR, ESI, 24Q and Form 16. In the UAE: a SIF your bank accepts.
- How is it priced as you grow? Per-employee pricing is fine at 20 people and painful at 500. Do the five-year sum, not the monthly one.
- Who owns the data if you leave? You should be able to export every employee, every run and every payslip.
For most small companies with a straightforward single-country payroll, an established SaaS product is the sensible answer. A custom or dedicated system starts to make sense when you run several entities, pay in two currencies, or have pay rules that off-the-shelf tools force into workarounds. That is the kind of system we build in our custom software work, with no per-user licence fees. If you are weighing the two, message us on WhatsApp with your headcount in each country and we will tell you honestly which side of that line you are on.
Founder of Growbz (Chennai, est. 2023). Runs the Google Ads, SEO and web builds behind every case study on this site, including the 14-month catering campaign whose numbers we publish in full.