My self is Kesari from Hyderabad working in an organisation as an HR & Accountant. We have registered our Organisation under EPFO act under voluntary coverage
with 15 employees wherein all the employees BASIC and DA is More than 15000/- and employer has decided to pay the EPF on full BASIC and DA (which is more than 15000) but sudden now after 1 year my management is asking to fix the deduct of PF at 1800/- (ie 15000 of Basic and DA). I just want to know is this legally correct.
1 Since One year they are paying EPF under shown below
Gross Pay(PM) Basic Pay (PM) PF 12%(PM)
1 Syed 100000 70000 8400 /-
2 Mohad 90000 63000 7560/-
2 Now all of sudden they want to change this to below
Gross Pay (PM) Basic Pay (PM) PF 12%(PM)
1 Syed 100000 70000 1800/-
2 Mohad 90000 63000 1800/-
Kindly advise me with your valuable suggestion.

From India, Hyderabad

Freelancer in HR &Indirect taxes for services indusrty.
Thetr is some mistake in understanding the cslculation of epf by you.Suggest pls refer to the epf act carefully. And understand the latest rules and notifications.
The upper limit is 15000 for epf wages for employer.Edli is contribution is locked at 15k by epf.
So pls rework on your epf calculations given in the post.

From India, Vadodara

HR Consultant
EPFO has no intervention to employees who draw basic above 15000/- employee + employee policy matters to the contribution above the 15000 limit
however the ECR format ask for format GROSS Wages / EPF wages EPS wages EDLI wages
EPFO does not ask for basic and DA in their ECR format, instead they ask for EPF wages on which the contribution is payable, be careful in filing ECR


Freelancer in HR &Indirect taxes for services indusrty.
Employer Max Limit of Contribution is 12% on 15k. Therefore it is not mandatory for employer to contribute beyond 15k. Employee however can choose to contribute at higher rate above his Basic and DA. Edli contribution is Fixed at 0.5% on 15k Max.
Based on this, calculations can be arrived at as to how much contribution is to be made by employer and employee.
It is Also to be noted that if employer and employee both agree to pay the contributions beyond the said limits a declaration is required to be submitted to epfo accordingly. In this case also Edli contribution max limit will be 0.5% on 15k.

From India, Vadodara
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