PF Deduction As Per The New Circular

Concept of CTC and enhancement of PF coverage limit.
CTC prior to enhancement of PF coverage limit CTC after enhancement of PF coverage limit
Basic 10000 10000
HRA 6000 6000
TOTAL MNLY Gross 16000 16000
PF DEDUCTION EMPLOYEE 780 1200
NET TAKE HOME SAL 15220 14800
EMPLOYER'S PORTION OF PF 890 1361
CTC 16890 17361
Therefor take home salary will be less and CTC will increase.(Calculation has been made considering PF deduction only on statutory limit).
S K Bandyopadhyay
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+919831081531

Dear All,

As recommended by some of my frienda that CTC has not any legal stand is absolutely right. But now a days many organizations are even designing their pay package on CTC basis. It is also correct that employer contribution of PF and ESI cannot be deducted from employee gross salary.

Let us take one example : Monthly gross 14,000/- ( Basic - 8000/-, HRA- 3000/- and other allowances - 3000/-). Yearly Gross = 14,000/- x 12 = 1,68,000/-. ESI employer contribution = 7980/- per annum, Bonus as per act (20%) = 8400/- annually, Welfare (canteen subsidy, tea, coffee etc.) = 15,520/- per annum. No PF deduction as excluded employee. Total CTC before Sept,2014 ( Before PF amendment) = 2,00,000/- per annum. From September 2014 after PF amendment , the employee is covered under PF and employer contribution to PF will be 13,065/- per annum. Therefore, the new CTC will be 2,13,065/- from September,2014. Earlier take home salary of the employee was monthly gross - ESI employee contribution - PTAX if applicable. Now the take home salary will be monthly gross - ESI employee contribution - PF employee contribution - PTAX if applicable.

Now a days it is really complicated to make scientific pay structure considering Minimum wage, PF gross, ESI gross, ITAX rebate pocket, Variable pay etc.

Thanks and Regds.,

S K Bandyopadhyay

USD HR Solutions

+9198310 81531

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If an new employee basic is more than 15000/- than it is compulsory to deduct provident fund or not

Dear All,
One of our employee is having more than (Basic+DA) 15000/- and his pf amount is regularly contributing to pf authority. But now he wnats to exemtion from this.
Is there any provision in EPF act?
Please help me on this.
Regards,
SHIVANAND

My basic 7540 and now company tell conver in ctc so how much my ctc figure nd also tell 24% pf cut. So gov rule it right or wrong???

If fixed CTC is 6.3lpa, employer contribution of PF is 1800rs . Their is no talks about employee pf in salary break up. So just wanted to check in fixed CTC both employer pf and employee pf contribution is deducted with tax ? Or only employer pf is deducted? Once we leave organisation are we eligible to claim both employer and employee contribution of PF ?