Provident Fund Query - CiteHR
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Provident fund calculation query:
1. If Basic+DA is less than 6500 (if employee is not a member of PF or a member of PF prior)
2. If Basic+DA is greater than 6500 (if employee is not a member of PF or a member of PF prior)
3. What percentage of Basic should be of gross salary
4. Can we restrict to PF contribution to 780p.m. irrespective of basic wage.
As 6500 amount is revised to 15000; does it all go in same way for 15000 as well.
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Hi, GO Not yet received, so it will not effect as of now. i think.... Regards, Suresh Kumar M
Case 1- PF is compulsory.12 % of actual Basic+DA.
Case 2-Pf is optional subject to liability limited to 12% of Rs 6500/-or actual.
Q-3 No law in this regard.
Q 4_Yes.
As on today it is 6500/- only.When it is enhanced to Rs 15000/ ,it apply in the same way as to 6500/-
Varghese Mathew
Dear Neha
Reply point wise is under
1. If employee whose Basic + DA is less than Rs 6500/- it is mandatory that employee should be member. if the Firm is registered with EPFO, (See eligibility)
2.If Employee is not member whose Basic plus DA is above Rs 6500/-, exemption can be sought refer para 36, Form No. 11 to be filled in
3.There is no law for this, but practice says that 40% of CTC should be basic Pay, where in HRA should be 40/50 % of Basic Pay, please take note of it.
This is practice across the industry.
4.Yes we can restrict it to Rs 780/ as per EPF
And if the Wage ceiling goes up to Rs. 15000/- it will change accordingly. Gazette Notification is still awaited.
Hope I ahve made the things clear.
V K Sharma
Dear All, The amendment is just issued, we have to still wait for the final notifications and date of applicable Regards, Dharmesh Sartanpara
Dear All,
There was circular issued on 14.07.2014 from EPFO(Ministry of Labour Govt. of India) New Delhi, as I mentioned in my recent thread that this is only CIRCULAR. Gazette Notification is awaited. so need not to confuse nor get confused.
V K Sharma
Dear Sharma, If gross salary Rs.8000/- its for Consolidated Salary, so what about the EPF section says. if any section????? Regards, Suresh Kumar M
I second the reply given by Mr. Varghese Mathew with only one correction in Point 4
4. Can we restrict to PF contribution to 780p.m. irrespective of basic wage. Yes if the Basic is above the cap i.e. Rs. 6500/- p.m. , and not irrespective of basic if the basic is less than the cap it should be 12% on actual basic.
If basic is less than or more than Rs 6500/- the rate of employer's contribution will be 12% only.
Nothing in the Act prevents the employer from contributing on more than Rs 6500/-
Varghese Mathew
With due respect I do agree, but the member has asked whether the employer can restrict the PF Contribution to Rs. 780/- p.m. for which I replied if the basic is Rs. 6500/- or more than the employer can restrict the contribution to Rs. 780/- p.m. and if the basic is below Rs. 6500/- than the contribution towards PF will be 12% on actual basic.
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