Understanding PF Deduction Rules: Should DA Be Included and Can We Set Limits?

I would like to know about the PF deduction process. I am working in an engineering company as an HR. We are deducting PF only on the basic salary at 12%, and we are not including DA in it. I want to know if there is any rule that requires adding DA compulsorily. Also, if we want to set a limit on PF deduction, what is the provision for it? Can you help me solve this query?

Awaiting your reply.

Regards,
Raju

Yes, you have to add DA for deducting PF. Basic wage is nothing but Basic + DA.

PF Contribution Requirements

As per the PF Act, the member has to contribute at the rate of 10% or 12% of his basic pay, D.A., and retaining allowance if any. In case the member wants to contribute more than this, voluntarily he can do so at any rate he desires, i.e., up to 100% of basic and D.A. But the employer is not bound to contribute at the enhanced rate.