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Free letter template · Word

Paid Internship Letter

A paid internship letter offers an internship with a monthly stipend and explains how the stipend is paid. It covers payment date, bank details, how leave affects stipend, and any tax deduction, so there is no confusion at month end.

  • Editable Word (.docx)
  • Made for India
  • 16 fill-in fields highlighted
  • Free, no sign-up

Preview of the letter

[Highlighted] = fill in
[Company Logo][Company Name]

PAID INTERNSHIP LETTER

Ref. No.:
[Reference Number]
Date:
[Date]

To,
[Intern Name]
[College / University Name]
[Intern Address]

Subject: Offer of Paid Internship – [Internship Role]

Dear [Intern Name],

We are happy to offer you a paid internship as [Internship Role] with [Company Name] from [Start Date] to [End Date], at our [Work Location] office.

Stipend details

ItemDetails
Monthly stipend₹[Amount]
Payment date[Pay Day] of the following month
ModeBank transfer to the account in your name
Leave allowed[Leave Days] days during the internship
DeductionsAbsence beyond allowed leave deducted pro-rata; tax as applicable

Other terms

  1. Mentor: [Mentor Name] will assign work, review progress weekly and evaluate your performance.
  2. Expenses: Pre-approved travel for internship work will be reimbursed.
  3. Pre-placement offer: Interns who perform well may be considered for a pre-placement offer, at the company's discretion.
  4. Status: The stipend is a training payment. The internship is not employment.
  5. Confidentiality and IP: Work done during the internship belongs to the company and must be kept confidential.
  6. Conduct: Company rules and the POSH policy apply to you.

Please share your PAN, bank details and college letter before joining, and sign a copy of this letter.

Yours sincerely,

For [Company Name]
[Authorised Signatory]
[Designation]
Accepted
[Intern Name]
Signature: ____________
Date: [Date]

What this template includes

  • Stipend amount and payment date
  • Attendance-linked stipend calculation
  • Leave days allowed during internship
  • Tax treatment note
  • Reimbursement of approved expenses
  • Completion certificate and PPO possibility

When to use it

  • Engineering, MBA or design internships with a fixed stipend
  • Long internships of three to six months
  • Internships converting to pre-placement offers
  • Companies building a paid early-talent pipeline

How to customise this template

  1. 1Enter monthly stipend and payment date
  2. 2Decide leave days allowed
  3. 3Mention TDS treatment as advised by your accountant
  4. 4Add a PPO clause if relevant

HR tips

  • Pay stipend on time; interns often depend on it
  • Collect PAN and bank details at joining
  • Treat stipend as training payment, not salary, in records
  • Communicate PPO criteria early

This template is a starting point only for stipend-based internships. Review it against applicable labour laws (including the Labour Codes in force from 21 November 2025 and the state rules being notified), your Shops & Establishments registration, standing orders and company policies, and take advice from a legal adviser where needed.

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Frequently asked questions

Is TDS deducted on internship stipend?+

Tax treatment of stipend depends on its nature and amount. Ask your accountant whether TDS applies and under which head.

Is stipend reduced for absence?+

If the letter links stipend to attendance, unauthorised absence beyond allowed leave can be deducted on a pro-rata basis.

Do paid interns get PF?+

Genuine interns receiving stipend are generally not treated as employees for PF, but confirm with your PF adviser.