You can be exempted under Provident Fund act when your Basic salary is more than Rs.6500/- but on one condition only if there is a consent form 11 filled between both employer and employee stating that employee doesn''t want PF and employer also agrees for the same. If you want your PF to be deducted the limit of basic will be Rs.6500/-.
Dear there is no law which says how to bifurcate salaries but generally it is to be bifurcated on friendly basis by taking income tax act into consideration
i've 3 employees, who have basic salary more than 6500/-rs. & they are 16000, 14000 & 8000 respectively. I deduct the employer share on their basic salary, now my question is that on what amount should I deduct the employee pension fund which has max. limit of 541/-rs.
Assume that if employee A has basic salary of 16000/- rs. & has attendance of 28 days in April month. so employer share deduct on 16000/30*28 = 14933/- rs. but for employee pension fund, on what amount should I deduct 8.33%.
On max limit 6500/- or 6500/30*28 = 6067 on this amount.
also help me, how can we put employee for the wage month april-2012 & how can provide new PF no.
respected seniors plz reply me soon with clarification
thanx & regards,
As per your post it seems that you are contributing on actual basic salary and not the celing limit which is 6500/-, well congratulations to you as your company is paying on actual basic salary.
Now you question is that how pension deduction shows -
When the PF is deducted at actual basis then you have to deduct 12% on actual earned basic from employee side and it goes 100% to PF Account No. 1, and for pension fund 12% payment of employer is bifurcated as - you have to pay Rs. 541/- which is max contribution for pension fund Account No.10 (considering basic salary Rs. 6500/-) and remaining amount of that 12% goes into PF Account Number 1.
Now 2nd question - why you are showing that old employee as new and seeking new pf number, no need to do this and you can not do this because you can not reduce the salary of any individual,
you can only do this when employee leaves the organization and rejoins again after 2 to 3 months then only you can issue him new pf number with new salaries.
1) You are not exempted from PF Scheme; 6500 is only a ceiling amount for employer contibution.
2) Your company is liable to contribute 12% on your basic ceiling amount of Rs. 6500 to your PF account.
3) Basic+DA can be veried as per company policy; it should be followed Minimum Wages Act. That Set.
As in the above given post many seniors told about the ceiling of PF deposit is Rs. 541 max which is 8.33% of Rs. 6,500/-.
But in many other related topics it has been provided that 12% of Basic i.e. Rs. 6,500/- is constant which amounts to Rs. 780/-.
Hence, my confusion is which amount is actually fixed is it Rs. 541/- or it is Rs. 780/-.
Need your valuable guidance ASAP.
Greetings for the day,
Rs. 541/- is the EPS(Employee Pension scheme) contribution, and the cealing for EPS & EDLI is fixed i.e Rs. 6500/- it means that whatever be the higher limit 12% (EPF) the EPS (8.33%) Should not be more than. Rs. 541/-.
Thanks & Regards,
Sumit Kumar Saxena,
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