Confused About My PF Withdrawal: Am I Calculating My Contributions Correctly?

I would really appreciate it if you could help me resolve my queries. I was working with an IT organization for exactly 2 years and resigned in May 2012. I opted for the PF option, and 12% of my basic salary, along with the same amount as the employer's contribution, was deducted as PF contributions.

PF Contributions Overview

For April 2010 to April 2011, the PF Deduction was ₹1600.00 (Employee's contribution). For April 2011 to April 2012, the PF Deduction was ₹2076.00 (Employee's contribution).

While reading through some articles on the net, I came across information that the Employer's contribution is bifurcated into sub-parts.

For example, for April 2010 to April 2011:

- My Contribution P/M = 12% of Basic = ₹1600
- Company's Contribution P/M = 12% of Basic = ₹1600
- Employer's contribution to EPS = 8.33% of Basic = ₹1110.64

This ₹1110.64 is higher than the max limit of ₹541/month, and hence, the Employer's contribution to EPS is ₹541.

Therefore:

- My Contribution P/M = 12% of Basic = ₹1600
- Employer contribution to PF = ₹1600 - ₹541 = ₹1058.96

So, the Total PF contribution to the PF account per month is ₹2658.92 (i.e., ₹1600 + ₹1058.96).

Queries on PF Calculation

1. Is the above method correct for calculating my PF contribution per month?
2. If yes, then the employer's contribution is less than mine, which is not correct.
3. In my company, the employer's PF contribution was already included as a part of CTC, i.e., 12% from the employer was already paid to me, so I was contributing almost 24% from my salary. Since NOW I HAVE SUBMITTED THE WITHDRAWAL request for my PF, I should get that 24% monthly contribution back, but per the above method, I am not getting it, correct?
4. If my calculation is wrong, please send me the correct calculation and the total amount I would receive as withdrawal.

Also, it would be great if you could let me know how much time it would take if the withdrawal form was submitted on 14th May 2012 and PF deduction started on 1st April 2010.

Thanks,

Prashant

As per your calculations, you are absolutely correct. From April 10 to April 11, you will receive your amount based on your deductions, i.e., Employee's 12% and Employer's 12%. The same will apply in the following year as well. In the received amount, there is no doubt that you will get 24% per year.

Apart from this calculation, it pertains to PF and Pension. This means that when an employee's EPF deduction is 12%, the same percentage will be contributed by the employer. However, there is a breakdown in that; out of the employer's 12%, 3.67% will go towards PF and 8.33% towards your Pension. When you calculate both, it will automatically sum up to 12%.

Please be assured that you will receive your full amount.

Regards,
Ashwin
[Phone Number Removed For Privacy Reasons]

As per your calculation, you're absolutely correct. From April 2010 to April 2011, you will receive your amount as per your deduction, i.e., Employee's 12% and Employer's 12% on the basic salary. The same will be received in the next year as well. In the receiving amount, there is no confusion; you will get 24% per year with interest, i.e., 9.5% for the year 2009-10 and 8.5% for the 2011-12 year.

Apart from this calculation part, it is a matter of PF and Pension. It means when an employee's EPF deduction is 12%, then the same will be from the employer's side. But there is a bifurcation in that; out of 12% from the employer, 3.67% will be PF and 8.33% will be your Pension. If you calculate both, automatically it will be 12%.

Please feel free. You will get 24% plus interest on all your amounts for your service period.

Regards,

Thank you very much for your valuable inputs! I was confused because of the following reasons:

1. I assumed that not the total 12% amount is paid by the employer, and therefore the company's contribution is less than mine, which takes the total figure down.
2. So, with the above calculation, I counted the total contribution as 1600 + 1058, which actually should be 1600 + 1600 for me when it comes to withdrawal.
3. Now, per your suggestions, I will get 3200/- * 12 months + the rate of interest for the respective year.

Thank you very much again and keep sharing your useful knowledge!

Thanks,

Prashant

You are saying that the maximum limit for EPS is 541, and you are deducting the same from 12% of the basic. But my doubt is that the maximum limit for PF is 780 from both the employer's and employee's side. However, you are contributing more than that. So, maybe the employer is giving more to EPS than 541 (i.e., 8.33% of your basic).

Your Contribution P/M = 12% of Basic = 1600
Employer's contribution to EPS = 8.33% of Basic = 1110.64
Employer's contribution to EPF = 3.67% of Basic = 490
So, the total contribution to EPF is 1600 + 490 = 2090

That's why you are not getting the expected amount. I don't know if this is correct or not. Seniors, please correct me if I am wrong.

Thanks & Regards,
Meghana

I would like to clarify one thing: the EPF ceiling is Rs. 6500/-, and the deduction is Rs. 780/-. The EPF contribution from the employer's side is a maximum of Rs. 780/- (239 + 541). However, in your case, I think your company has obtained permission from EPFO with your consent to make deductions/contributions on the basic above Rs. 6500/- under para 26.

Summary of Contribution Details

I am providing a summary of your contribution details, please review carefully:

Basic Sal. | Emp. Share | Er's share | Pen. Fund
2010-11
13335 | 1600 | 1059 | 541
2011-12
17300 | 2076 | 1535 | 541

Kindly multiply the above figures by 12, but ensure interest is calculated on EPF contributions only. Pension fund contributions are excluded from interest.

Thanks,
Mahender Rana

As far as my understanding goes, for example, if one's basic is Rs. 10,000, then the PF amount for an employee's contribution is Rs. 1200 (both EPF and EPS - 12% of basic) and the employer's would be Rs. 780 (both EPF and EPS accounted for 12% of the minimum basic Rs. 6500). Am I correct? Kindly clarify.

Thanks

Hi Prashant, the attached format was contributed by one of our sharing members in this forum. Please go through it; it may help resolve your problem.

Thanks,
Bijay

Please find the file below on the Calculation of Employees' Provident Fund, which is collected from CiteHR. I believe it will clear your doubts.

Cheers,
Regards