Legal Advice Needed: Can We Limit PF to 12% of Rs 6500 for Expats in Our Company?

Dear seniors, My company has expats from AUS & NZ working in our company, and currently, we are paying 12% of their gross salary as PF. Is it legal to restrict PF to 12% of Rs 6500 per month for expats? If so, could you please provide me with the supporting documents?

Thank you.

You cannot restrict PF to 12% of Rs. 6500 per month in respect of expats. Contribution in respect of expats is calculated on basic wages, DA, Retaining Allowance, and on the cash value of any food concession. This contribution is not restricted to Rs. 6500.00.

Currently, you are paying the contribution at 12% on the Gross. You cannot now split this gross into Basic, DA, Retaining Allowance, and the cash value of food concession etc., and reduce your liability. This would amount to a reduction in PF wages, which is not permitted under the Act.

Thank you.

I agree with Mr. Korgaonkar. The limit of ₹6,500 is not applicable to expats, i.e., International Workers (IW), as per the PF Act.