Understanding Voluntary PF Contributions: What Happens if an Employee Exceeds 12%?

Is there any limit to voluntary PF contribution by an employee.

What happens to the employer's contribution in case the employee contributes more than 12%? Is the employer's contribution frozen at 12% or does it increase to 13.61%?

We have received one such request from one of our employees.

Saurabh

Dear Employer,

The employer contribution to PF is 12% of Basic + DA + Retaining allowance. The employer limit is fixed, and the ceiling limit is 6500.

Employee contribution: If an employee wants to increase their share in PF, they can do so. The PF Act is not clear on the maximum limit, but PF authorities accept a 12% statutory contribution + 12% voluntary contribution from the employee, and they do not accept any in-between formula. According to the Payment of Wages Act, it states that the total deduction cannot exceed 50% of the employee's salary, including all components.

To increase their contribution in PF, take a written application from the employee clearly stating how much they wish to contribute.

For more HR-related information, please visit: [White Eagle: PF Query](http://kuldeeprathore.blogspot.com/2009/08/pf-query.html)