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Calculation Of PF Admin Charges - Provident Fund

sreenandhini2003 Started The Discussion:

Dear Friends,

I have the following doubt.

PF administration charges shall be calculated @ 1.10% of wages.
I am not certain about the definition of wages. Please tell me
on what component of wages it has to calculated. i.e. Gross pay
excluding HRA or Gross pay limited to Rs.6500/-.

Can some one help me to resolve my doubt. please provide
reference for present G.O. or Amendment regarding EPF Act

aashidelhi - Contributing Member
Hi sreenandhini,

Pls find the answers as u required:-

* PF is calculated on (basic+DA)& it is covered by central Government.
* PF is a kind of benefit & savings for the employees & a part of deduction as well.
* basic means the minimum wages & wages varies from state to state & parameters on which wages vary will be according to the cost of living.

*6500 is the limit of PF.

* DA=Dearness Allowance will vary acc to central Govt & state Govt. the changing ratio will be dif. for State & Central Govt.

*Employee Contribution towards PF Ee =12%
Employer Contribution Er = 12% + 1.61% (administration Charges)

*if B+DA = 650 then Ee = 12%, Er = 12%+1.61%
Ee = Rs 780, Er = Rs 780 = 1.61% * 6500 = Rs. 104.65

Calculation
A/C 1 (Employee Provident Fund Account,EPF), Ee = 12%, Er = 3.67%
Ee= Rs780, Er= Rs238.55

A/c 10(Employee Pension Fund) Er= 8.33%
Er= 8.33 *6500/100 = Rs.541.45

A/c2 (Administration Charges),1.1%
1.1%*6500= Rs.71.50

A/c21 (Employee Developed Linked Insurance Charges),0.5%
0.5%*6500= Rs.32.50

A/c22(EDLIC),0.01%
0.01%*6500= Rs 0.65


Total Administration Charges = Addition of all 1.1% + 0.5%+ 0.01% 1.e.
Rs(71.50+ 32.50+ 0.65) = Rs 104.50

I hope now you will be able to understand ur query in a better way.



Regards,
AAshi





Quote:
Originally Posted by sreenandhini2003 View Post
Dear Friends,

I have the following doubt.

PF administration charges shall be calculated @ 1.10% of wages.
I am not certain about the definition of wages. Please tell me
on what component of wages it has to calculated. i.e. Gross pay
excluding HRA or Gross pay limited to Rs.6500/-.

Can some one help me to resolve my doubt. please provide
reference for present G.O. or Amendment regarding EPF Act

switboy321 - Banned
aaashi please try to come on chat want to ask in detail about PF we are paying PF administration charges on the total gross wages earned by employee.... , are we doing right or wrong ;(

Krishnamkn - Contributing Member
Dear aashi, Thank you for your valuable response, kindly provide your email id. Regards, Krishna Murthy

Hello everyone,

I have a doubt regarding contribution of PF from employer side.
As I understood there are 3ways of contribution
1. PF
2. Family pension scheme
3. Deposit linked insurance fund

My doubt is Employer has to choose his contribution from the above three or in all he has to contribute some % in all three from this 12%
for ex: Employer contribution for Pension fund 8.33%+ 3.67 for Pension fund

Please clarify my doubt.

Regards,
Kalyani

vd_003 - 
(EE X 2) + ER = Total PF Amount Where, EE is Employer & Employee’s Share ER is Other Receivables by Employee (including interest)

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