Hi, I found the PF differ from person salary.Is it true??? Can I know the actual PF structure ???? How to calculate ????
If it is CTC...then PF means 24% of your basic and if it is gross salary then it is 12% of your basic.
CTC is the cost to the company it include all those above & cost which company is paying like on computers,AC etc...
Then Wht is the diffecence between them.?? I m working in a software company ,here they used to cut Professional Tax . How it is calculated . Couse as per the govt .0 is the value till salary of Rs 5000/- Then why Rs35/- used to be cut which I found in my office .
PF differs from person to person simply bacause the salary differs from person to person.
When your establishment is covered under EPF and (Misc Provisions) Act the employer is entitled to deduct 12% of (Basic+DA) component of your salary and is obliged to contribute identical amount from employer's side and deposit the sum in your PF account maintained in the office of the Regional Provident Commissioner's office OR in the Trust especially established by the employer and approved by the PF authorities. Therefore 12% of different salary levels will yield different amounts! Right?
Now to deal with some other questions that have got raised in this thread.
1) Gross Salary should include money payments made to the employee by the employer either on a monthly basis or on annual basis.
2) The may also include the indirect payments like employer's contribution to PF, Bonus/ex-gratia or such other inderect payments.
3) CTC should actually mean the Gross Salary PLUS all other employee related expenses (apportioned to an individual employee) like, uniform, cost of company provided transport, subsidy provided in canteens for food, Annual functions etc.
I am of the opinion that it is wrong on the part of the employer to negotiate salaries on the basis of CTC. Negotiating a gross salary is more realistic as other items of employer's expenses included in the CTC, though real costs, are incidental expenses of which the individual may be a beneficiary of. These do not reflect cost to the company of the individual's worth in terms of his competence.
Again CTC is a matter purely of INTERNAL purposes like budgetting. In fact the law states that it is WRONG for the employer to recover employer's share of PF contrinution from employee's salary. When the CTC publicly claims that employer's share of PF is a part of CTC, one could get into trouble with law.
Having said all this, I also bring to your notice that only employees in receipt of basic wage/salary less than Rs. 6500/- per month are covered under the act.
I hope the issue clear now. For specific querries you are welcome anyway!
November 25, 2006
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