Confused About PF Deductions and Admin Charges? Let's Figure It Out Together!

Dear All,

Recently, I was reviewing my PF slip and noticed that the admin charges of 1.61% have not been added, even though the same amount has been deducted every month from my salary. When I withdraw the PF, will I not receive the 1.61% in addition to the 24%, i.e., 12% from the employer and 12% from the employee?

Could you also please provide me with the format for calculating the PF and interest? Since our company does not calculate DA, it would be helpful for me to understand how the amount is calculated.

I am looking forward to a positive reply from your end.

Regards,
Sapna

Dear Spana, I am wondering why your company is deducting administration charges from your salary. Companies have to pay the administration charges; maybe your company is doing the same. Anyway, check with your Finance/H.R. Department about the same.

I want to inform you that P.F. administration charges will not appear in payslips. It is not an income of the employee; it is an administrative cost to the company. You can see only the Provident Fund amount, which is Employee (12%) + Employer (3.67%), totaling 15.67% on your payslip out of 24%. The balance of 8.33% goes to the FPF amount, and this will not appear in the payslip; it will be paid at the time of retirement.

Please note that P.F. interest differs from year to year; it depends on the government decision. Currently, the P.F. department is giving an 8.5% interest on the Provident Fund amount.

Thank you.

Hi dear,

You are eligible for administrative charges i.e., 1.60%. The PF calculation will be done in the following manner: basic + DA = 6500. If below 6500, PF should be deducted compulsorily (or) basic less than 6500 also DA the same. When you withdraw your PF, you will be getting 12% + 12% + 1.60%.

Thanking you,
Priyanka.

Dear Priyanka,

When you withdraw your PF from the EPF department, you will receive only 12% of the employee's share and 3.67% and 8.33% of the employer's share. If you complete less than 6 months of continuous service, you will not receive the 8.33% of the employer's share.

Thank you,
Vipul Johri

Dear Sapna,

The admin charges have to be paid by the company and not by the employee. The point made by Mr. Telikepalli is correct – admin charges are not the income of the employee.

Regards,
Stalin P.

Dear sir,

The charge of 1.61% is the government inspection fee. These charges do not constitute the income of the employee; instead, they are the responsibility of the employer. You will not incur these charges at the time of PF withdrawal. Instead, you will receive 12% of the employee's share, 12% of the employer's share, and interest.

Regards,
R.D. Sharma

EPF Withdrawal and Contribution Queries

Please solve my problem. I am in BSNL, and my EPF from my side is ₹2,754 (12% of my present basic ₹16,900). It's only 1 year and 8 months in BSNL. I wish to leave BSNL, so on leaving, how much amount will I get from EPF? According to our account section, from the employer's contribution, 3.67% is added to my EPF account, and the rest 8% is added to the pension scheme, which I can benefit from only after 10 years of service. Can I continue my EPF account after leaving the job? If my new employer does not contribute, can I contribute from both sides to maintain my EPF account?

In other words, how can I get the complete amount (mine and the employer's) from the EPF office?

27-4-2009 to 1-01-2009 EPF ₹2,576/- (employees) onwards Jan 2009 to till date - EPF ₹2,754/- (employees)

In the PF slip, you will find only 12% + 3.67% and the rate of interest is also not 8.33% (EPS). As far as administrative charges are concerned, it is the liability of employers, not of employees.

Thanks & regards,

Sumit Kumar Saxena
+91-9899669071, 0120-4131277

Administration charges of 1.61% need to be paid by the company, and it should not be deducted from the employee's salary. You can take up the issue with your HR/Finance department.

In your question, please find attached. I hope it will be useful. Please give a reply.

Dear Sapna & Sumer,

First, I shall address Sapna's case. Regarding administration charges and interest rate, TELIKEPALLI has provided a clear explanation. Interest will be monthly compounded and rounded to the nearest rupee.

Regarding Sumer, your statutory contribution to the Pension Fund will be Rs. 541/- i.e., 6500 x 8.33%. If you have already chosen to contribute based on your full salary (instead of 6500/-), then your contribution to EPS-95 will be 2754 x 25/36 = 1912. Although there is an option to select the actual salary exceeding 6500/-, I have not encountered such a scenario.

That is, out of the employer's share of 2754, only 541 will be allocated to EPS-95 (not the full 8.33%). The remaining 2213 along with the employee's share of 2754 (totaling 4967/-) will be deposited into your individual account.

If you leave BSNL now, your service of 1 year and 8 months will be rounded up to 2 years. Since you are not eligible for a pension, you will receive a withdrawal benefit. i.e., the last salary (capped at 6500) x 1.99 (factor per Table B) = 12935/-.

Both the above amounts (the sum in PF as well as EPS) can be processed immediately after leaving the current job. However, if you intend to secure a pension along with additional PF service in the future, you should apply for a scheme certificate.

If your new job is covered by PF, you can continue. Otherwise, it will be impossible to contribute to EPF as per your choice.

Regards, Abbas.P.S

ITI Ltd, PALAKKAD - 678 623

Ph. [Phone Number Removed For Privacy Reasons].

Please find below the corrected text with proper formatting:

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Pl. give format of fill-up form for the allotment of a business number (BN).

Our basic + DA = salary Rs. 10,000/-
How to calculate PF. Pl. give knowledge of PF.
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Dear All,

Recently, I was going through my PF slip and noticed that the admin charges of 1.61% have not been added, although the same amount has been deducted from my salary every month. When withdrawing the PF, will I not receive the 1.61% in addition to the 24% (12% Employer & 12% Employee)?

Could you also please provide me with the format for calculating the PF and interest? Since our company does not calculate DA, understanding the calculation process would be beneficial for me. I am looking forward to a positive response from your end.

Regards,
Sapna

Admin Charges Responsibility

Admin charges are the responsibility of the employer, so why are these charges deducted from the employee's account? The 1.61% is an administration expense that the company should bear; there is no involvement from the employee's end in terms of addition or deduction.

Calculating P.F. Interest

Calculating P.F. interest can be quite complex as interest is calculated daily, with monthly additions to the P.F. account. Your contribution consists of a 12% deposit into your P.F. account. Of the employer's 12% contribution, 3.67% is deposited into your P.F. account, and 8.33% goes into your FPF (Family Pension Fund) with no interest provided on the FPF amount.

Hi, I am Harsh Sharma. I worked 17 and 1/2 years in a pharma company. When I resigned from the company, I withdrew my PF money. However, I haven't received my pension certificate to date, even after one month of withdrawing my PF amount. I would like to know when I can expect to receive my pension certificate.

Thank you.

Dear all,

Please let me know if there is any time limit (i.e., length of service) for withdrawing pension. I mean, why was Sumer not eligible to withdraw the pension amount before 10 years? I am a bit new to the organization and am in the learning stage. Please help!

Regards,
Neha

I shall respond to HR practice, har77, & Neha Gupta regarding PF interest calculation. I have already mentioned that it is monthly compounding and rounded to the nearest rupee. I shall insert an Excel sheet in this regard. You can extend the rows (as per your requirement) and enter the salary applicable for PF.

Processing of Pension or Scheme Certificate

Regarding the processing of Pension or Scheme Certificate, it normally takes one month. If you do not receive it after one month, there may be some clarifications required by the PF Authorities. In such cases, please contact them with details.

Withdrawal Benefit and Pension Requirements

For Withdrawal benefit, only one year is required (even 6 months will be rounded up as 1 year). However, for pension, a minimum of 10 years' service is required.

Regards,
Abbas. P. S

Provident Fund Calculation:
- 12% contribution by Employee
- 3.67% contribution to PF by Employer
- 8.33% contribution to Pension by Employer

This contribution is taken by the employer in which amount:
- 0.5% towards EDLI contribution
- 1.11% towards administrative charges

Please let me know if you need further assistance or clarification on the Provident Fund contributions.

Dear Sachin Singh,

Understanding the Employees' Pension Scheme

The Family Pension Scheme-1971, under EPF, has been replaced by the Employees' Pension Scheme - 1995. If you are an existing member of this scheme, there is no salary limit to be exempted.

Contribution Details

Regarding scorpionehal's statement that 8.33% will go to the pension fund and 3.67% will go to the PF as an employer contribution, please note that for EPS, practically the contribution is limited up to a salary of Rs. 6500/-. Beyond that, it will also go to PF as the employer's contribution.

In this regard, you may use my Excel sheet cited above.

Interest Calculation

Note: Interest on PF will be compounded monthly. The 8.5% interest is annual. To calculate the monthly interest, divide this 8.5% by 12. Initially, in my Excel sheet, annual interest was used for monthly compounding. Now, I have edited and corrected it.

If there is any error or suggestion, please notify me.

Regards,
Abbas.P.S