Provident Fund Update: Is Your Take-Home Pay About to Decrease?

New Notification from Provident Fund

Coming up: new notification from Provident Fund; please see the attached article published in 'The Economic Times'. The take-home salary may further reduce.

Regards,
PBS KUMAR

Thank you for the valuable information. It will help everyone to be prepared and to have some breathing room for the same. Thanks again.

Regards,
Ravi

Issue is not as big as it appears to be, especially for those who are already drawing salaries much above the PF limit of Rs. 6500/- per month.

The last paragraph of the article reiterates the fact that, as long as the salary ceiling of Rs. 6500/- per month remains in place, there will not be a significant impact of this judgment.

Agreed with VKO Kamthankar, but as we take the reference of the EPFO Circular on PF on wages No Coord. 4(6) 2003 Clarification Vol. II dated 21.06.2011, it implies that where the overall wages are less than Rs. 6500/- per month, the PF shall be deducted on overall wages irrespective of the salary bifurcations.

Does it further imply that the basic wages for PF is Rs. 6500/- per month, or are the actual overall wages paid, whichever is lower, considered as the basis for PF?

Thank you, PBS Kumar. However, any new employee recruited and receiving a gross salary of above Rs. 6500 (including all allowances) and having a basic/DA of, let's say, Rs. 3500 will not be enrolled for EPF. This is an injustice to the low-paid employees since there are no savings. Previously, a similar employee was receiving a Basic+DA of Rs. 3500, and his gross was Rs. 6500 - Rs. 780 = Rs. 5720, with savings (own + Company Contribution) totaling Rs. 1560 (PF + Pension). Clearly, he is at a loss! I hope that the minimum wage is revised to Rs. 10000 from Rs. 6500!

Regards,
Rajusiachen