ESI Return Filing: Monthly Contribution and Half-Yearly Return
Every employer registered with ESIC must deposit 4% of covered employees’ gross wages each month: 0.75% deducted from the employee and 3.25% paid by you. The payment is due by the 15th of the next month. We prepare the monthly contribution on the ESIC portal, generate the challan and keep your records ready for inspection.
What it is
Employees’ State Insurance (ESI) gives covered workers medical care, sickness pay, maternity benefit and disablement cover. It is funded by a monthly contribution from both the employer and the employee, collected by the Employees’ State Insurance Corporation (ESIC).
“ESI return filing” is the monthly routine behind it. Each month you enter wages and days worked for every insured employee on the ESIC employer portal, the system works out the contribution, and you pay it through an online challan by the 15th. The ESI Act, 1948 and the ESI (General) Regulations, 1950 set these rules. The Code on Social Security, 2020, in force since 21 November 2025, carries the same scheme forward, and the contribution rates have not changed.
Picture a garment unit in Faridabad’s industrial area with 40 workers, most earning between ₹14,000 and ₹20,000. Every one of them is insured, and every month’s wages turn into a challan. Monthly filing is the main job. Records are also kept for each six-month contribution period, and the regulations provide for a half-yearly return of contributions within 42 days of each period’s close.
Who it applies to
Factories and shops with 10 or more employees
Once your establishment is covered and registered, contributions are payable for every employee within the wage ceiling, whether permanent, casual or on contract.
Employees earning up to ₹21,000 a month
Workers with gross wages up to ₹21,000 (₹25,000 for persons with disability) are insured. Those above the ceiling at the start of a period stay outside.
Principal employers using contractors
If a contractor’s workers do your work, you are responsible for their ESI if the contractor fails to pay. Here is the catch: many Faridabad factories use a labour contractor for loading or housekeeping. Ask for the contractor’s challans every month. It takes five minutes and protects you.
Contribution rates at a glance
These rates have applied since 1 July 2019. In practice, the most common mistake is calculating them on basic pay. ESI runs on gross wages, so allowances count.
| Item | Rule | Example on ₹18,000 gross |
|---|---|---|
| Employee share | 0.75% of gross wages | ₹135 |
| Employer share | 3.25% of gross wages | ₹585 |
| Total deposit | 4% | ₹720 |
| Low-wage employees | Average daily wage up to ₹176: no employee share, employer still pays 3.25% | – |
| Due date | 15th of the following month | June wages by 15 July |
Why it matters
Your workers can use their benefits
Benefits depend on contributions paid in the matching contribution period. A missed month can leave an employee unable to claim sickness or maternity benefit later.
You avoid interest and damages
Late money attracts 12% simple interest a year plus damages. If you run payroll compliance with us, the 15th is built into the calendar. Paying by the 15th keeps the cost at exactly 4% of wages.
Inspections go smoothly
ESIC can inspect wage registers and compare them with your filings. With clean monthly records, the visit is short.
Documents required
Each month
- Salary register with gross wages per employee
- Attendance or days-paid record
- List of joiners and leavers during the month
For new employees
- Aadhaar and date of birth
- Family details for the e-Pehchan record
- Bank account details
Employer side
- ESIC employer code and portal login
- Contractor challans, if you use contract labour
- Accident or incident reports, if any
How it works
Register new joiners before they start
If you are not yet registered, start with ESI registration for your establishment. Each new insured employee then gets an IP number on the ESIC portal. We add joiners as they come and mark leavers, so the monthly list is correct.
Upload wages and days for the month
From your payroll, we enter each employee’s gross wages and days paid. Most clients pair this with their monthly PF return, since both run on the same salary sheet. The portal calculates the 0.75% and 3.25% shares.
Generate and pay the challan by the 15th
The portal produces a challan. You pay it online through your bank, and it shows against your employer code.
Reconcile and keep the period file
We match the challan with your salary register and keep one file per contribution period for the half-yearly return and inspections.
Timelines
Monthly contribution
By the 15th of the month after the wage month. For September wages, by 15 October.
Contribution periods
1 April to 30 September, and 1 October to 31 March. These periods fund the benefit periods of January–June and July–December that follow.
Half-yearly return
Within 42 days of the end of each contribution period, which is around 11 November and 12 May.
What happens if you pay late
Interest at 12% a year
Under Regulation 31A, simple interest at 12% a year runs on each day the contribution stays unpaid after the due date.
Damages that grow with the delay
Under Regulation 31C, damages are 5% a year for delays under 2 months, 10% for 2–4 months, 15% for 4–6 months and 25% beyond 6 months.
Recovery and prosecution
ESIC can recover dues like arrears of land revenue. Deducting the employee’s share and not depositing it can also lead to prosecution under the ESI Act.
Frequently asked questions
What is the due date for ESI payment?
ESI contribution is due by the 15th of the month following the wage month. So wages for October must be paid for by 15 November. If the 15th falls on a holiday, pay a day early rather than risk the bank’s cut-off. Paying on time keeps your cost at exactly 4% of covered wages, with no interest or damages added.
What are the current ESI contribution rates?
The employee pays 0.75% of gross wages and the employer pays 3.25%, a total of 4%. These rates have applied since 1 July 2019 and continue in 2026. On a gross salary of ₹18,000, that is ₹135 from the employee and ₹585 from you. Your payroll software or our team can work this out for every employee each month.
Which employees are covered by ESI?
Employees whose gross monthly wages are up to ₹21,000 are covered, and up to ₹25,000 for persons with disability. This includes casual, temporary and contract workers in a covered establishment. Employees earning above the ceiling are not insured. If you are unsure about a particular role, we can check it against your salary structure in a few minutes.
What if an employee’s salary crosses ₹21,000 mid-period?
Coverage continues until the end of that contribution period. If an employee gets a raise to ₹23,000 in July, contributions continue on the full wage until 30 September, and the employee exits coverage from 1 October. This rule protects the employee’s benefits for the period already started. We track these changes so your monthly filing stays correct.
Do low-paid workers pay the employee share?
No. An employee whose average daily wage is up to ₹176 is exempt from the 0.75% employee share. The employer must still pay its 3.25% for that worker. This mostly affects apprentices, helpers and part-time staff. The portal handles the calculation once wages and days are entered correctly, so the main job is accurate attendance data.
Do we still need to file a half-yearly ESI return?
The ESI regulations provide for a return of contributions within 42 days of each contribution period, that is, around 11 November and 12 May. Because monthly contributions are now filed online, most of that data already sits on the portal. We keep each period’s file reconciled so the half-yearly step, and any inspection, takes very little extra work.
What is the penalty for late ESI payment?
Late payment attracts simple interest at 12% a year from the due date. ESIC can also levy damages under Regulation 31C, from 5% a year for short delays up to 25% a year beyond six months. The longer the delay, the higher the rate. Clearing arrears quickly, even before a notice arrives, keeps the damages at the lowest band.
Is ESI payable if we have no covered employees in a month?
If no employee within the wage ceiling worked in a month, there is no contribution to pay for that month. Your registration stays active, though, and once covered, an establishment remains covered even if headcount falls. File the month as nil where the portal requires it, and keep salary records to show why nothing was due.
Has the Code on Social Security changed ESI filing?
Not in the day-to-day sense. The Code on Social Security, 2020 took effect on 21 November 2025, but the contribution rates of 0.75% and 3.25% and the due date of the 15th are unchanged. Filing still happens on the ESIC portal. We watch the new rules as they are notified and will tell you if any step changes.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
There is no government filing fee for ESI. The amount you deposit is the contribution itself: 4% of covered gross wages, plus interest and damages only if paid late.
Ready to begin?
Share last month’s salary sheet and your ESIC code, and we will handle this month’s contribution before the 15th.