Pan Singh Dangwal
Joint Manager
Elancherans
Labour Law Compliances
Sepreta
Account

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i have joined this company about a year ago with the help of refrence.theu gave me offer letter saying my

salary will be 20k in which hand will 17500 and rest is some tax and pf.

so this was my first time for getting pf and i have no knowledge in what tax and pf they deduct.

please see the refrence screenshot of my offer letter for details mention in my offer letter.

this whole time i was in hope that company is deducting

2500 so will be depositing atleat 2000/- in my pf from it and 2000/- from employers side.

but when i looked care fully at my salary bifurcation it said they are depositing 960 in my pf

so my 1st doubt is where is my other 1000/- deducting ?

now let say they are depositing this 960 as pf then

why am i getting only apprx 300/- from employer side ?

my assumed annual savings was

2000 (employee ) + 2000 (employer side) x12 = 48000



total deduction : 2500x12 = 30000

what i am getting is : 15500/- (consider my pf passbook attachment)

thanks for reading and answering.

From India, Mumbai

Attached Images
File Type: jpg salary biferucation.jpg (162.2 KB, 41 views)
File Type: jpg pf.jpg (66.1 KB, 24 views)

With reference to your salary bifurcation your fixed gross salary is 18655 which was fixed by your employer. Including your employer EPF contribution (960) & gratuity (385) it is 20000. From 18655 less your EPF contribution of 960 (8000*12%) you are supposed to get 17695.
EPF is a social security benefit, every employer has to make sure that they cover the employees in EPF as per norms. No tax is deducted from your salary as you are not coming in tax bracket as your annual salary 18655 * 12 is less than the IT limit.

From India, Madras
Dear Sepreta,

First of all welcome to the community which is based on “Sharing and Learning” basis.

This is your very first discussion, I would appreciate the way you have explained your query. You have not only provided the detailed data but also attached relevant doc. to clarify your points. Here most new comers post there query in very casual approach with lot of short forms (like typing any social media message). Very few explained there query in proper way.

Now come to your points. You have mentioned “salary will be 20k in which 17500 will be in hand”. Let me explain you, the “Salary” here means your total CTC, which will include your monthly salary and employer’s other exp. towards your employment in the company. Employee always get monthly salary after making needful deductions. We never get the CTC. As stated by fellow member your in hand salary should be 17695 (Gross salary – EPF, 18655-960). There may be some other deduction/s on account of Professional Tax, Labour Welfare Fund (which may be applicable in your state). May be you are getting Rs. 17500/- after those deductions, or otherwise we can say the 17500/- was told as round off figure.

Your main concern is for EPF Calculation. Your assumption that the company is deducting Rs. 2500/- or depositing at least Rs. 2000/- is incorrect. When clearly Rs. 960 is mentioned in your offer letter how it can be 2500/- or 2000/-. Pls note once again 20k is your CTC not salary. Don't assume that your PF deduction should be Rs. 2500 (20000-17500). It is 960/pm as given in offer letter and PF passbook as well. So I think, your 1st doubt of other 1000/- is cleared now.

However, on going through the attachment I have noticed your company initially deducted and deposited Rs 960 (which is absolutely correct as per the offer letter). But later the company has deducted and deposited higher PF. May be later some salary corrections done. In Maharashtra, DA is also a compulsory part of Wages Structure (which is not shown in your letter). May be later DA component included/adjusted in your pay structure and PF is deducted and deposited on DA as well.

The Employer PF is further divided into two parts (Pension Fund and Employer PF). For your knowledge out of employer 12% contribution, 8.33% of Basic+DA (subject to maximum Rs. 1250) is deposited under “Pension Fund” & the rest deposited into Employer PF Contribution. You can see the total of “Employer contribution” and “Pension Fund” is equals of Employee Share (5402+2381=7783). So don't think less Employer contribution is deposited.

So, as of now your salary, PF (employer contribution) all are fine.

Hope I have clarified your points to your satisfaction.

From India, Delhi
Anonymous
Hii Sepreta,
With reference to your salary bifurcation your fixed CTC salary is 20000 which was fixed by your employer.
BASIC 8000
HRA 4000
CONV. 1600
MEDICAL ALL. 1250
SPEA. ALL. 3805
GROSS 18655
Deduction:-
Employee's share in PF =12% on basic = 960
Employer's share in pf(before april 2017)=13.36% on basic=1069(deduct from your gross salary)
Gratuity (4.81% on basic) = 385
LWF(deduct from your gross salary) = 48(36 Employer's share and 12 employee's share)in mumbai
IN HAND = 17538
Hope it will help you !!!

From India, Gurgaon
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