Employee/Employer PF - Basic Salary
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Employee/Employer PF - Basic Salary

sailajachanna Started The Discussion:

Hi


I have a query regarding PF - Provident Fund. Please correct me if I am wrong.

Generally PF is calculated @12% of Basic salary of Employee. Also Employer PF is calculated @12% of Basic.

Is Employee PF is deducted OR Employer PF is deducted OR Both PFs are dedected from the salary??

Is that necessary to calculate Employer PF and Employee PF?? For whom
it is applicable.

If so please give the salary structure for a guy earning 10000/- CTC per month.

Taking Basic,HRA,Allowances,Deductions,PF(Employer & employee),PT(100/-) into consideration.

Also what exactly is the difference between CTC and Gross. And the take home(net).


Thanks

Kriti Sampat - Member Since: Dec 2007
Hi,

You are right that PF is calcualted at 12% of Basic + DA
It is applicable to the organizations :-

every factory engaged in any industry specified in Schedule 1 in which 20 or more persons are employed;

every other establishment employing 20 or more persons or class of such establishments which the Central Govt. may notify;

any other establishment so notified by the Central Government even if employing less than 20 persons.


If the employer is contributing towards PF than an employee is alos bound to contribute towards it. The maximum contribution that an employer is bound to make towards PF is Rs. 780 pm. However, it si optional for an organization to contribute in PF beyond that.

In case a person's CTC is Rs. 10,000 pm.

then, his salary will be:-
Basic -----
HRA ----------
Other Allowances---------
___________________
Gross Salary
+ Employer's contribution towards PF
___________________
CTC

The net salary will be Gross Salary less Employees contribution towards PF.

Hope I had been fair to reply to your queries. Please feel free to contact me in case of any other doubts.

Regards,
kriti

Quote:
Originally Posted by sailajachanna
Hi


I have a query regarding PF - Provident Fund. Please correct me if I am wrong.

Generally PF is calculated @12% of Basic salary of Employee. Also Employer PF is calculated @12% of Basic.

Is Employee PF is deducted OR Employer PF is deducted OR Both PFs are dedected from the salary??

Is that necessary to calculate Employer PF and Employee PF?? For whom
it is applicable.

If so please give the salary structure for a guy earning 10000/- CTC per month.

Taking Basic,HRA,Allowances,Deductions,PF(Employer & employee),PT(100/-) into consideration.

Also what exactly is the difference between CTC and Gross. And the take home(net).


Thanks

sailajachanna - Member Since: Dec 2007
Hi Kirti

Thanks for the information.

My present company holds 300+ emplyees
Currently im earning 10000/- but did not apply for PF and my take home is 9900.

Recently in one interview, my interviewer is completly focussing on my PF and i told him the same like i did not apply PF and so i have one deduction i.e PT=100/-. He didnt agree to my point and saying that its mandatory to apply for PF.

But even my pay slip is generated and it also shows the same figures.

One more thing is, he asked about my CTC, Gross and Net. I told CTC is 10K pm. The gross is 9900 pm and even take home is 9900.

He questioned me, how can the gross and takehome would be the same. I told since i didnt apply for PF, both figures are one and the same.

I believe i m not wrong at this point. Please correct me.

Now my question is,

***When PF is indirectly meant for saving the money, then why shud one strictly apply for that(if not having intention to save the money)and should be a part of salary??

***When will both GROSS = NET ??

***How the salary structure is defined for any company. What should be considered and what not to be considered???


PLEASE CORRECT ME...!!!
As for my understanding,
>>CTC includes all the Basic, allowances, emplyee and employer benefits and deduction.(Everything)
>>GROSS includes the allowances and Basic, HRA,PF(employee&employr)...but not Deductions(like PT)
>>NET = GROSS-PF(Employer, employee)


Pleaes reply on the same.[/b]

indupraveen - Member Since: Mar 2009
Hi,
This is Praveen, i have started up a new firm, there are about 10 employees working in

my firm, for the pay of 6000/-. i need to start up a PF for my employees, can you please

tell me the procedures how to start up, and what are the documents need to be

proceeded to PF office. please reply me as soon as possible.

Thank you
with regards,
Praveen

rammijubbal - Member Since: Jun 2009
i have a query correct me if i am wrong working in a orginasation for 4 or 5 months . can i apply for my PF withdrawl

babu adsul - Member Since: Sep 2013
1) our company engaged sum sub contractor particular site but that contractor are not more than 20 labour engaged but overall site more than 50 labours of different contractor ,that situation pf is applicable or not. and give me explanation of sub contractor definition

deenajag - Member Since: Aug 2007
Hello,

In this situation PF is applicable.

For definition and details of payment for sub contractors - please find below link for the same -

EPFO (chk sr 428)

EPFO

Hope this helps.

Warm regards,
Deena Jagasia

babu adsul - Member Since: Sep 2013
But madam individual sub contractors are not taking number that situation what i can do? company is responsible or what, and if sub contractor is taking number that time who is responsible?

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