What is the maximum EPF contributed to the employee per month?

Hi Team
I have one doubt regarding EPF.
What is the maximum EPF contributed to the employee per month?
How many days in a month consider for salary calculation.
regards
Dayakar

Dear Dayakar,
For EPF deduction the ceiling basic salary limit is 6500/-. So maximum one can contribute is 780/- only.
If the pay of a member employee increases beyond rs. 6500' after his having become a member, he shall continue to be a member but the contribution payable in respect of him shall be limited to the amount on monthly of rs. 6500/- only.
Regards,
Amit Seth.

Hi Dayakar,

The PF contribution is 12% of Basic salary from both employee and employer. For the calculation the maximum limit of Basic is Rs 6500/-. It means even if the employee's basic salary is above Rs 6500/- the employer is liable to contribute only on Rs 6500/-, that is Rs 780. However if an employee so desires he may voluntarily contribute more than 12%. Apart from it an employer also has to pay some administration charges. I explain you the various accounts of PF challan.

A/c No 1: PF contribution Account

A/c No 2: PF Admin account

A/c No 10: EPS account

A/c No 21: EDLIS account

A/c No 22: EDLIS admin account

PF admin charge = Employer has to pay 1.1 % of basic

EDLIS: Employer has to pay 0.5% of basic

EDLIS admin charge:Employer has to pay 0.01% of basic

Total additional percentage employer has to pay: 1.61% of basic

So employer has actually to pay 13.61 % of Basic and employee has to pay only 12% of basic.

Employees complete 12% goes to PF account while employer contributions' 8.33% goes to Pension fund and 3.67% goes to PF fund.

For any further further clarification do ask.

Amit Goyal

Mr.Amit goyal,
I would like to know the difference between "Pension fund " and "PF fund".Please send the info immediately
regards
ramana kumar

Hi,
Well as per the statutory requirements PF will be calculated only on Rs 6500/- even if the salary is over Rs 6500/-. That is Rs 780/- from both sides plus admin charges as i mentioned in my earlier mail.
Amit Goyal

Dear Ramana,
In the Employees Provident Fund and Miscelleneous Provisions act there are three funds.
1) Employees Provident Fund
2) Employees Pension Fund
3) Employees Deposit Linked Insurance Scheme (EDLIS)
As I mentioned in my earlier mail the contribution percentage goes to each of these funds. As per the accumulations in the PF fund and Pension fund it is payable to the PF member after superannuation. Provident fund amount is payable in one lot while the pension fund amount is payable on monthly basis in the form of pension. (Provided that you have not withdrawn the fund)
In case you withdraw the amount from PF the entire amount of PF and Pension fund is payable with interest.
Amit Goyal

hi amit,
There is limit & also no limit to the PF contribution that depends on the company in which he working
a) if an employees salary (basic wages) is more than Rs.6500 then to we can deduct the Pf on that whole amount our up to the limit that is Rs. 6500/-
b) if an employees salary (basic wages) is more than Rs. 6500/- then it depends on the company to weather deduct his PF or Not if you are not deducting his then Please fill Form No. 11 ( very Important)
Regards
Chandrakant V.
9820592842
(PF , ESIC, Contract labour act & Other Labour laws Consultant)

Dear Amit,
Very well explained!!
Can you please clarify the counter queries that crossed my mind for this topic
1. What is the significance of EDLIS? Does this get paid to the employee as well? If yes when?
2. Can a member withdraw pension like PF before his superannuation?
3. Does the admin charges of 1.61% go to the PF and EPS bodies?
Rgds,
Shilpa

Hi Shilpa,

1) Under EDLIS the nominee of the PF member will receive the insurance amount. For more info plz follow this link http://epfindia.com <link updated to site home>

2) Yes ofcourse, once a member leaves the organisation he may claim the complete amount accumulated in PF and Pension fund provided he/she has put in atleast 6 months of the service with the organisation. If (S)he leaves before 6 months (S) he will not be paid the pension fund amount. Only PF fund amount will be paid. There is one more clause that an employee should not have joined any other organisation for 2 months after leaving last organisation but this is not followed in general practice because the certificate is to be given by the last emoployer that the said member has not been employed for last 2 months and generally all employer give this certificate after 2 months of leaving. This is not the seperate certificate but part of the PF withdrawal form.

But now Social Security Number is coming into effect. With this SSN every PF member will be given a unique number which will be the PF account number for the whole life regardless of the companies a member changes. Once this is operationalise completely through out INDIA , no member will be able to withdraw the amount before superannuation. Ofcourse there will be a provision of taking loan from the PF funds.

3) First of all complete 1.61% is not admin charges. 0.5% of it is EDLIS contribution which is paid by the employer only. Rest are 1.1% PF admin and % EDLIS admin that too paid by the employer only. Yes these admin charges go to the repective PF and EPS bodies. You cant withdraw any of the parts of 1.61%.

For any further querry feel free to write.

Amit Goyal

If the employee is getting 8000 as basic pay, his pf contribution will be 6500x12% =780 and employer contribution to his account will be 6500x13.61%=885. You need to restrict the calculation on the amount 6500. Any amount above 6500 not needed to take for calculation.