Confused About EPF Deductions on Payslips? How Should I Show Employer and Employee Shares?

I have a query regarding the payslip. In my company, we are deducting the EPF employee and employer share from employees only (i.e., we are deducting two shares from employees with their acceptance). As the EPF consultant suggested, we have to show the employer and employee shares separately. If we show it like that, we need to add 12% to their salary. I am confused about how to prepare the payslip for this. Please suggest to me the best format.

Thanks & Regards.

Yes, you can show deductions of employee PF and employer PF separately.

Here, you need to deduct the Employer PF contribution from the CTC part. The deducted amount should be treated as Gross Salary, making it easier for you to generate the Salary Slip.

Your query is somewhat unclear to me. How can you deduct the employer's share from the employee, which is improper and goes against the scheme? The statutory contribution from the employers should be separate, attracting other payments as well while remitting the money to EPFO. This liability belongs to the employer and the employee.

Employee Coverage Under Provident Fund Schemes

Are your employees covered under the Employees Provident Fund Scheme, 1952, or the Public Provident Fund? If they are covered under EPF, then it is incorrect; however, if they are requesting deductions under PPF, then it is acceptable. Please note that EPF is managed by the EPFO, while PPF is handled by nationalized banks.

I advise your consultant to thoroughly study the scheme before implementing it.

Regards,
Adoni Suguresh
Sr. Executive (Personnel, Administration & Industrial Relations) Retired
Labour Laws Consultant

Dear Adoni Suguresh,

I had the same doubt, and I discussed it with my management. They mentioned that they are following the CTC method, where the employer's contribution is also part of the CTC.

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