Madhu.T.K
Industrial Relations And Labour Laws
Rkn61
Hr Manager
Yogendra Dhaka
Chartered Accountant

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Hello members, My company has paid Rs. 1 lakh as advances to an employee. his basic salary is Rs. 12000. Now my question is that, is it require to deposit PF (whether employee contribution or employer contribution) to Govt at the time of payment of advances or should comply pf provision at the time of each month for which advance has been given. i am asking for these because we have received a notice from govt to deposit pf on advance paid to the employee. so please give your suggestion.
Salary advance is an advance recoverable from the employee either in one installment or monthly installments by deduction from salary. Advance amount is not a salary earned by working but it only a loan from the employer. No PF shall be deducted from this amount. Just give a reply to the PF that the amount represents advance paid to ..... and is recoverable from his salary. If you pay PF for the amount advanced, will the EPFO refund it every month when you collect it from the employee? No.
If you have booked this amount as salary advance, I don't think that PF Enforcement Officer will take it as salary paid. If mistaken, you can just say that the amount represents advance recoverable from the employee and not salary paid.

I do not think you have to pay PF contribution for the amount advanced by you to your employee. Can you exhibit the letter received from EPFO, in this forum, so that suitable reply could be framed.
Satisfactory Explanation.
What would be the Advance Tax if any Deductible/ Payable and time burred or due date accrued and due at if applicable at the stage of payment of salary Advance.
Regards with Thanks.

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