Understanding EDLI Contributions: Should We Cap at Rs 6,500 or Use Total Salary?

Companies covered by PF have to remit 0.5% of the salary as a contribution towards EDLI. I understand that the maximum salary for this calculation is only Rs 6,500 and not the actual salary, which can be more than this.

As of now, we are remitting 0.5% of the total salary instead of restricting it to Rs 6,500 as the salary. Please clarify which salary should be considered.

You should have restricted the EDLI and admin charges to a salary of Rs. 6,500. If overpaid, you may adjust with future payments after discussing the matter with the Enforcement Officer or Accounts Officer of the EPFO.

Regards,
Madhu.T.K

Dear Babu,

EDLI charges are also restricted to 6,500, i.e., Rs.32.50 maximum. Because this is a kind of insurance premium, the benefit one can avail is also restricted to the tune of 6,500 only. Hence, you need not contribute more than Rs.32.50 for each member. As Madhu advised, you can approach PF authorities to get it adjusted before this annual returns.

S. Sethupathy, Excellent HR Services, Erode.