Understanding the Difference in Employee and Company PF Contributions: Why Is Mine Higher?

Hi,

My contribution to PF is Rs. 1100, but the company's contribution to PF is Rs. 559. Why is there such a difference?

Hi,

Your entire PF contributions go to the PF account, whereas there is a limitation due to the ceiling limit of Rs 780 (Rs 6500 is the maximum limit for PF consideration). Some companies pay PF contributions on 12% of the actual basic of the employee. It is Rs 239 and Rs 541, which makes it Rs 780, and it is the contribution ratio of 8.33% to the pension fund and 3.67% to the PF fund from the employer side. Hence, the management will be making the balance of Rs 239-1100 to your pension fund, whereas your entire contribution of Rs 1100 will be in the PF fund.

Hope this clarifies it for you.

Regards,

R Sudhakar