Provident Fund Dilemma: Should We Deduct PF for a One-Time Payment to Non-Resident Employees?

Query on Provident Fund Deduction for Non-Resident Employees

We have non-resident employees. Every month, we provide their salary. Apart from the initial arrival, we offer a one-time travel allowance. Do we need to deduct and remit PF for this single payment?

Regards

PF deduction should be only on Basic and DA rather than Travelling allowance.

Provident Fund Entitlement for Employees

Every employee of an institution, factory, mine, or shop is entitled to have their Provident Fund (PF) paid by the management. There is an option for employees who are drawing a salary of more than ₹6,500/-.

We are deducting and remitting PF for their salary regularly. My doubt is whether we also need to deduct PF for any one-time payment.

PF is a deduction/contribution on basic + DA (unless your company is so generous that it contributes to PF on the gross salary). One-time payment, in my opinion, will not change the basic + DA, so there is no need to deduct/contribute PF on the same. However, members can provide better suggestions if you attach the salary slip.

Regards

The PF commissioners are insisting on deducting PF from the gross salary of expats. We have agreed to this; however, the traveling allowance is a one-time payment and has not been included in their salary statement. They are also asking for this amount to be deducted from the PF. Is this correct?

Regards,
S. Vijay Anandh

No, PF is permitted to be deducted only on Basic + VDA. TA, HRA, Mobile Allowance, etc., will not be included in the PF. It depends on the organization based on the salary structure.