Pf Calculation For Gross More Than 15000 - DOCX Download - CiteHR
Saswatabanerjee
Partner - Risk Management
Glidor
Hr Consultant
Suresh2511
Labour Consultant
Rajeshkhattar
Pf & Esic
+4 Others

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Dear All,

As I am aware that PF Ceiling limit for deduction is 15,000. I have recently received my first Salary Slip from the employer, in which following bifurcation of the salary is mentioned;

EARNINGS:

Basic = 9357

Connveyance = 1600

Bonus = 584

Special Allowance = 5391

Total Gross = 16,950

DEDUCTIONS:

PF = 1800

ESIC = 297

PT (Madhya Pradesh) = 208

My argument with the HR is that my PF should be deducted on Basic i.e. 9357 * 12% = 1125, whereas our HR Manager is arguing that as the ceiling of PF is Rs. 15000 so it will be deducted on 15000 as my total earnings is more than 15000.

In case my Basic Salary would be 15000 or more...then only PF deduction would have been Rs. 1800, but my basic is only 9375, then it should only be Rs. 1125.

Kindly help me in this...Am i correct or my HR Manager is correct?

Thanks in advance.

Please ask your HR to consult with a PF Consultant or read the bare act
HR is considering all amounts except conv for pf deductions, and by this way the employee is getting extra benefit from employer’s contribution side
@GLIDOR Employers Contribution is also deducted from Employee’s salary..Even though in that case total amount deducted should be 1125+1125...and not 1800
Dear
PF Contrubution should be on Basic+DA, in your case Basic is 9357 and deduction should be made in this, so please ask HR to review and study the Defination of "Wages" in Bare Act EPF & Misc. Prov. Act 1952.

Hi, I agree with Mr Rajesh. Your HR has considered incorrect amount for calculating PF.
Dear experts,
I (hr executive) join new company some time before. I am facing problem to understand salary breakup here, as i know as per rule
basic is 50% of gross and HRA is 40-50%of basic and other allowances like conveyance, LTA, and others should be in salary breakup.
But in my company salary breakup is different. Also pf deduct on minimum wage or 15000.
please help me to understand this breakup of salary is wrong or right.
Please have a look on attachment.


Attached Files
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File Type: docx sal breakup.docx (153.9 KB, 230 views)

Rinki,
This site shall answer most of your concerns in payroll.
It would be a good idea to understand salary components along with labour law workings the way they are done in a company.
Am not endorsing any brand.
My colleague worked up his way with payroll nuances from an
experienced person.
Should you want i can connect you.
Goodluck!

If an employee’s basic salary is 18000 Rs, then we have to calculate pension and EDLI on only 15000 Rs.
Employee PF Contribution 12 % On 18000 = 2160
Employer Pension Contribution 8.33% On 18000 = 1250
Employer PF contribution = 2160-1250 = 910 ( Here we don’t take 3.67% )
Note : When you use ECR excel it will be calculate automatically. We just need to enter basic salary of employee.
Read more details @ How To Calculate PF Of Basic Salary More Than 15000

As per the attachment the employer has taken Rs. 15,000/- as upper limit of Basic for all the employees for PF Contritbution calculation, whose Basic is over & above Rs. 15,000/- thats why the PF Contribution is Rs. 1800/- i.e. 12% of Rs. 15,000/-

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