An employee is drawing more than Rs.6500/ as basic and PF contribution is also being paid as per the rules. Do the company have to pay the same contribution the employee pays or it can restrict itself to Rs.6500 for employer contribution?
As per the PF rules Employee PF contribution can be paid for the full amount of their basic or it can be restricted to 6500/-. If the employee contribution exceeds 6500/- then there will be more burden on employer to pay more admin charges. So most of the companies restrict employee contribution to 6500/-
Even the employer contribution contribution also shall be restricted to 6500/-
There are some companies where in the employer & employee contribution will be for their full basic & they will add it to their CTC. Then the company is not loosing anything from their pocket.
There is no such resrictions on PF contribution either from employee or employer. There are such companies who pays PF contribution irrespective of Basic Salary.
Now in case of employer contribution, the basic salary is restricted to Rs.6500/- only for Pension Fund contribution.
AS PER RULES ENVISIONED IN EPF END MP ACT AND THE SCHEMES FRAMED THEREUNDER STATUTORY WAGE LIMIT IS RS 6500/. EMPLOYEE CAN CONTRIBUTE @ RATE OR HIGHER WAGE WITH EMPLOYER CONTRIBUTION RESTRICTED TO RS6500/.
IF EMPLOYER CONTRIBUTES @WAGE ANMINISTRATIVE CHARGES SHALL E APPLICABLE @HIGHER WAGES. MOREOVER AS PER RULE TO CONTRIBUTE @HIGFER WAGE EMPLOYER SHULD SEEK PERMISSION FROM OFFICE OF RPFC.
ONE MORE THING CONTRIBUTION @ HIGHER WAGE FOR PENSION FUND CAN BE DONE ONLY WHEN PAID FROM DATE OF JOINING.
As per the provisions of the Act, the amount is restricted to Rs.6500/- . But it is the descretion of the management whether to entertain the restriction or not. In PF that is (account number 1), over and above will booked in this account.
But for pension whatever we pay, it is restricted only for Rs.6500/-. The remaining amount of contribution will book into account number 1 in PF.
Hope this clarifies.
Kingfisher Airlined Limited
8.33% ------- Pension fund . (Calculation on Rs 6500. So maximum will be Rs 541 Per month ).
3.67%-------- Provident fund (on basic + DA of employee's salary).
If suppose, emplyee basic + DA is more than Rs 6500 ,eg, Rs 10,000 than contribution to Pension fund will be Rs 541 than adjusted amount will be transfer to Provident fund amount which will be 659.
Hope this is more clear . 8-)
Why Vote? User validation is extremely important for good content to prosper.