Need Help with PF Exemption Process After Salary Revision – What Forms Are Required?

PF Exemption Guidance Needed

I am working as HR in charge in a Biotech company situated in Kalol (near Ahmedabad). I need help regarding PF exemption. One of our employees' CTC was revised effective 1.11.2010. Earlier, his basic was 5800, and now it has been revised to 7900. As his basic is now above 6500, he wants to deduct his PF on 6500 or discontinue the PF deduction. I need guidance regarding the procedure and which forms need to be submitted by the employee and the employer to EPFO.

Regards,
Shivang

Dear Shivang,

He doesn't have a choice to discontinue because he has already been a member of the PF and can't opt out. According to PF rules, once an employee becomes a member of the PF scheme, they cannot withdraw during employment and must remain a member. As you mentioned, his basic salary has increased; therefore, he wishes to contribute based on the new amount. His contribution will be calculated on the new basic salary, and the pension amount will be deducted at Rs 6500/- with an 8.33% rate, with the remaining percentage added to the PF contribution.

Regards,
John

Question on PF Deduction

My question is: Mr. A is an employee of X company, and he joined in the year 2010 with a basic salary of Rs. 8000/-. He does not want to have PF deducted from his monthly salary. Is it possible? If yes, then how?

Regards,
JOJO81

PF Exemption for Company

Dear Seniors, can you please explain the procedure for obtaining an exemption from the PF Act for a small company under the AP Shops & Establishments Act?

EPF Coverage and Contribution Limits

An employee once covered under the EPF will continue to be covered irrespective of any hike in his salary. However, he can restrict his contribution to 12% of Rs 6500. If at the time of joining with a basic salary of Rs 8000, he was given coverage, he cannot discontinue it.

Exemption from EPF Operations

Exemption from the operation of EPF is given to an establishment when the EPF Organization finds that the establishment has separate schemes for social security and pension which are more beneficial than what is provided by the EPFO. For a small establishment, I don't think that there could be a better scheme than PF schemes.

Regards,
Madhu.T.K