Regarding Provident Fund [Thread 27909]

we want to know what is the maximum pf deduct in any employee salary.

Hi
PF contribution is 12% of basic subject to a maximum of Rs.6500/- per month. Voluntary higher contributions are also acceptable at joint request of member and the empoyer.
10% deduction is there in case on industries like sick industries, establishments engaged in manufacturing of jute etc etc.....complete list is there in PF act.
Regards,
Palak

12% from employee side, and 12% from employer side, but can anyone let me know, about PF in I.T sector

Hi,
The PF is deducted on Basic Salary that is 12% and max of PF deduction is only on 6500 i.e 780 and Employer Share is gives that amt in private sector.
Byee
Praveen
Darjeeling :)

PF IS CALCULATED 12 % ON BASIC + DA. THERE IS NO COMPULSION IF BASIC + DA IS MORE THAN 6500. BUT IF STILL PF IS DEDUCTED THAN THE PENSION PART I.E. PENSION WILL BE CALCULATED ONLY ON 6500 AND REMAINING AMOUNT GOES TO PROVIDENT FUND PART.
E.G. IF BASIC IS 10000
THAN PF WILL BE 1200
PENSION PART( EMPLOYER'S SHARE) WILL ONLY BE 541
REMAINING PART OF PF(EMPLOYER'S SHARE) WILL GO TO PROVIDENT FUND.
NOTE: 12 % OF EMPLOYEE
12 % OF EMPLOYER WHICH INCLUDES 3.67 % AS PF AND 8.33 % AS PENSION

Hi,
The normal practice is of calculating PF as 12% of basic. However, this is only the employers contribution. Another 12% is deducted as Employees contribution. So total is 24%.
As far as I know, there is no maximum limit . e.g. If an employee has Rs. 50000/ basic Salary p.m. then 12% comes to Rs. 6000. Hence the total amount deducted would be Rs. 12000/
Thanks and Regards,
Karan

12% Of The Basic Salary plus Dearness allowance fron Both side From Employww as well as From Employer side

The employee can have maximum 100% PF deductible salary (i.e Basic Salary + DA) deduction towards Voluntary Provident Fund.
This 100% includes the 12% compulsory contribution from employee towards PF (i.e. 100% - 12% - 88%)

ONLY 12 % IS DEDUCTED REST OF THE 12% IS GIVEN BY THE COMPANY NOT DEDUCTED
EX.....BASIC 1000RS
EMPLOYEE PAYS - 120RS
COMPANY PAYS - 120RS

In case the employees PF deductible salary is Rs.1000
The PF contribution would be as under:
A: By the Employer: 12% = Rs.120
B: From the Employee: 12% (which is compulsory) = Rs.120.
In case the employee so desires she/he can apply for 100% salary deduction towards PF. This extra contribution is called Voluntary Provident Fund which is subject to a maximum of 100% of the PF deductible salary of the employee less compulsory deduction i.e. 100% - 12% (compulsory PF) = 88% towards VPF = Rs.880
The option of applying for VPF (Voluntary Provident Fund) rests with teh employee and she/ he can decide whether or not they want to utilise this option, and if yes then up to what percentage.
VPF is usually preferred by employees as it is taken as an Investment under Setcion 80C of Income Tax.