PF Deduction On What

Dear all
some one can tell me that PF is deducts on gross salary of employee but what about deduction on HRA/DA/Med. Allowances if these are included with salary.


thanks
charanjeet singh ([Login to view])
09756286255

Dear Charanjeet Singh,
In general PF is deducted on Basic + DA. But certain other allowances also attract PF
A) Personal Pay
B) Service Weightage
So if you have such allowances in your pay packet please take the advise of your legal counsel and act accordingly.
M.V.KANNAN

Charanjeet
One PF official had told, 'even if Basic+DA' is less than Rs6500, the other allowances (say for example, residual pay) to be added to reach 6500. Example: if a persons Basic+DA=4000, and his other allowances are 6000, then his total gross is Rs10000.
Then PF is to be calculated on Basic+DA+other allowances should at least be equal to Rs6500.
Regards
Mahesh

Hi Charan,
PF shall be deducted on Basic+DA and not gross salary. Allowance do not attract PF Deduction.

PF is deducted on Basic+DA if (Basic+DA+Other Allowance) is equal to Minimum wages then deduct on Basic+DA+Other Allowance)
Regards
Manish

if basic is 10000 and we are deducting pf on 6500 then if the some one works for 28 days how we will calculate his basic wehter by cosidering basic on 10000 basis or on prorata basis of 6500 devided by 30 and multiplied by 28 kindly suggest.

hi,
iam sheetal i want to know how u calculated basic salary from gross salary and what is the last limit of basic salary

Hi Sheetal
Usually Basic is calculated on 40% on Gross or CTC. It purely depends upon the Companies policy.
Of course on Basic PF is calculated at 12%
Regards
Mahesh

Dear All
For the benefit of all members I gv below the interpretation given Regional PF commissioner, Chennai.
All along i hv been deducting PF on Basic + DA only. I hv worked in AP, Karnataka, Maharashtra and Gujarat before coming to Chennai.
RC of PF has sent us 7a notice and is claiming EPF contribution on 70% of Gross salary (rest 30% is HRA, which is the only exempted component). Such 70% of Gross salary should not be less than 6500/-.
The matter is under process but this the status as given by RC of EPF.
All along, i hv known that EPF contribution on Basic + DA is wrong as explanation given EPF act for salary. But contention of RC that 1. 70% of Gross salary should not be less than Rs.6500/- is disputable and 2. Assuming 30% to be HRA when IT allows 50% HRA in metros and 40% in other cities is also disputable.
regards
N Ramamurthy