Understanding PF Deductions: When Is It Necessary and Why Might It Be Skipped?

Respected Sir/Madam, with greetings, I am Hari Om Jha and I would like some information regarding PF.

PF Deduction from Salary

Q-1: When is PF deducted from the salary - for employees with the minimum salary (---------) or the maximum salary (----------)? I have observed during my training in an organization that PF is not deducted for anyone.

Necessity of PF Deduction

Q-2: Is it not necessary to deduct PF?

Thank you.

PF Deduction Eligibility and Limits

1. All employees are eligible for PF deduction. The maximum limit is ₹6,500 per month of basic salary. Even if employees earn more, deductions must be based on ₹6,500.

2. Yes, it's mandatory.

Employees whose basic salary is more than ₹6,500 can be exempted by submitting Form 11.

Regards,
Vishwanath

I suggest you please go through the definitions given under Para-2 (f) of the EPF Scheme for the exact meaning of such legal matters.

In simple words, it can be said that a person whose basic pay at the time of joining a covered establishment is up to Rs. 6500, or if he is already a member of EPF by virtue of his earlier employment, is statutorily a member. However, in case his basic pay is more than Rs. 6500 at the time of joining, he may become a member with the mutual consent of the employer if he was not a member earlier in his previous employment.

If the wages exceed Rs. 6500 during the regular course of employment, the employer may restrict deductions up to the statutory limit of Rs. 6500.

Regards,
A K CHANDOK RPFC (Retd.) <link no longer exists - removed>

Hi, I am Tirumala. I have a question: if we exceed a salary of 6500/-, how can we show the individual as a PF holder? I would like detailed information on this. Thank you.