Hi Pallavi,
Provident Fund is a is a compulsory contributory fund for the future of the employee after his retirement or for his dependents in case of his early death.
Every company having 20 or more than 20 employees are required to be registered under this Act.
Its a contributory fund where both employee as well as employer required to contribute 12% of basic salary. So the total contribution comes 24%.
Out of this 24%, 12% of employee and 3.67% of employer contribution goes to Provident fund whereas 8.33% of employer contribution goes to Pension fund.
The maximum ceiling basic salary to be a member of this fund is 6500/- per month. One may be member of the same even after that ceiling amount also, but the contribution would remain same 12% of 6500/- only, i.e 780/- rupees only.
But in some cases it may be even at the actual basic salary also.
Hope it must have helped you to clear your queries with PF..
Regards,
Amit Seth.