PF - Employee Salary [Thread 22555]

Hi frnds,
plz explain me above topic, if an employee salary 25,000/- its basic salary 60% from its gross salary (25000*60%=15,000), shall i deduct 12% (EPF) from its basic salary or deduct the ceiling amount of EPF 6,500
which i want to deduct. plz suggest me...
rgrds
ram

Hi Ram,
If an employee's Basic is more than 6500, PF will be deducted only after employee & employer both agreement.
deduction will be made 12% on basic and out of 12% only Rs. 541 will be deposited into FPS and rest will go to EPF.
Regards
Ranjeet
9871898784

Hi Ram,
You will have to deduct 12% PF on whole amount (BASIC+DA). Rs. 6500/- is just a criteria that if a person is having less than 6500/-, PF is mandatory for him. For people having (BASIC+DA) more than 6500/-, it is their will whether to continue with PF or not.
In case they want to continue, it will be deducted 12% of (BASIC+DA).
Santosh Iyer
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Hi Ram,
Yes you can cut PF on Rs. 15000, but the employers contribution will not divided like regular case.

Dear Ram,
You can deduct PF 12% on Rs.15000/- or Rs.6500/- (if the employee is new pf member). For new joining it is optional/management decision to deduct the PF on >Rs.6500/-
Regards,
Jony_M

Dear Member
Employee Contribution
Option 1- Employee contribution may be fixed upto Rs 6500/-
Option 2- Employee willfully want to contribute on Rs 15000/ ( Basic+DA)
he can be contributed if he is new PF account
Employer Contribution
However, the contribution of employer will be restricted to 6500/- only ( mutual consent employer and emplyee
Regards
Yandamuri

Hi Ram,
Rakesh Kumar Sharma from Gurgaon, your quire is to deduct EPF i.e. @12% on basic i.e. 15,000/- or ceiling amount i.e. maximum 6,500/-.
In my view it is not binding on Employer to deduct & contribute more than ceiling amount i.e. maximum 6,500/-, but it depends on organizations policy either they go as per ceiling or on full amount.
Generally in the interest of employees organizations go for full amount.
Please fell free to share with me, if you get some more good comments on this issue.
Regards,
Rakesh Kumar Sharma
9810680048

Hi Dear,

I wish to guide and suggest you as under :

1. You have to first find out whether salary is CTC which includes PF contribution as well.

2. If yes, it would not make any difference for any employer to restrict deduction of PF up to a limit of Rs.6500/- as mentioned.

3. PF Act does not restrict voluntary deduction and contribution beyond the stated limit of Rs.6500/- provided employer is willing to contribute . If CTC covers PF contribution as well , no employer in my opinion shall have any objection to such higher deduction, irrespective of any amount of Basic or Da or in combinaton.

4. Higher contribution may be restricted to one employee or be allowed for all employees depending upon employer's wish. Generally, HR professional should suggest uniformity.

5. Once opted , you as an employee or even an employer is not obliged to opt for lesser deduction in future till an employee remains in the employment of the company.

Hope, this shall give you enough clarity though other provisions of the Act need to be understood for making any policy on PF.

Regards,

Rajpal

Hi,
ok, i cut PF on Rs. 15000 and you mentioned that employers contribution will not divided like regular case, then how it will be divided
rgrds
ram

Dear ,
I mean if your question does not stand answered and doubt remains in the mind , instead of wirting and rewriting on the subject , one may pick up the phone and speak directly.
Regards,
Rajpal