Confused About PF Deductions: Should It Be 2,160 Rs or 3,850 Rs?

Hi all, my gross salary is 20,000, and my basic salary is 9,000, as indicated on my payslip. According to my discussion with HR, both employee and employer contributions are deducted from the gross salary. Therefore, based on the above conditions, approximately 3,850 Rs is deducted from my salary. The employee contribution is 12% of the basic salary, and the employer contribution is also 12% of the basic salary.

Now, my question is:

Employee contribution = 12% of 9,000 = 1,080
Employer contribution = 12% of 9,000 = 1,080
Total = 2,160 PF

However, they are deducting 3,850 from our salary. Please clarify whether the correct deduction amount should be 2,160 Rs or 3,850 Rs.

Thanks & Regards,
Praveen

If your basic salary is 9,000, then your deductions should be 1,080. If both contributions are deducted from the gross salary, then that's a wrong practice. If both contribution deductions are shown in CTC, then that's correct.

What Aditya said is correct. The deduction should be 12% of the basic salary from both ends, but many companies follow the CTC model, so they deduct both parts from the employee. In your case, it should be either 1,080 or 2,160 Rs, but under no circumstances should the company deduct around 3,850 Rs. Please contact the Payroll department and ask for clarification. Also, check other deductions; it may be possible that they have shown a total deduction of 3,850 Rs (including any others).

Hi Mrugen Vyas, they clearly mentioned in the payslip as (Employee) PF Contribution - 1,900.00. They are not showing the Employer PF contribution in the payslip.

Please contact your Payroll department and ask for clarification because, in no case, should more than Rs. 1800 be deducted from the employee's part. The EPF department has clarified that the maximum ceiling limit a company may deduct for PF is Rs. 1800 (15000 * 12% = 1800), so deducting Rs. 1900 is not a correct practice. You may also ask for your PF account number and check your balance online on the EPFO website.

Regards,
Praveen

Praveen, please contact your Payroll department and ask for clarification because, in no case, should a company deduct more than 1800 Rs. from an employee's part. The EPF department has clarified that the maximum ceiling limit a company may deduct for PF is 1800 Rs. (15000*12%=1800), so deducting 1900 Rs. is not the correct practice. You may also ask for your PF account number and check your balance online on the EPFO website.

It's been 10 months since I joined the company. They haven't given us the account number. They are only showing the PF Account Number: AP/HYD/73578/196 on the payslip.

Aditya is correct. The deduction should be based on 12% from both ends, but many companies follow CTC, so they deduct both parts from the employee. In your case, it should be either 1,080 or 2,160, but under no circumstances should the company deduct around 3,850. Also, check other deductions; it may be possible that they have shown total deductions of 3,850. Additionally, please check your appointment letter again and review your last month's payslip.

Thank you.

There are no circumstances to deduct a PF contribution of Rs. 3,850 either from your Basic Pay of 9,000 or your Gross Pay of 20,000. If you provide the CTC details (component-wise), then the deduction can be clarified. You may contact your Payroll Section for further assistance.

Regards,
M.K. Chaubey
Sr. Officer - Personnel

Hi Chaubey, please check the attached screenshot of the payslip. In the payslip, the Employer's contribution is not shown but is being deducted. Please clarify.

As per your attached payslip, the deductions seem to be correct. Your gross salary, as per your payslip, is Rs. 17,955. Deductions include Rs. 1,800 for PF (as per the new amendment) and Rs. 150 for PT (PT as per law).

You have stated that your gross is Rs. 20,000. Kindly check your offer letter for confirmation on whether Rs. 20,000 is your gross or your CTC.

Regards,

Hi,

If your full name is Praveen Kumar Reddy G and your company is VSPLASH TECHLABS PRIVATE LIMITED, then your company is remitting your PF contributions properly. Otherwise, you need to check with your HR regarding the same. You don't have to worry about the error you receive on the PF site. Due to certain technical issues with the PF department, the PF Member passbook is not getting updated properly for 30-40% of the companies, and your company might be one among them. (Even for my company's PF account, we are facing the same issue).

Regards,

Hi, Employee contribution = 12% of 9,000 = 1,080. Employer contribution = 13.61% of 9,000 = 1,224. Total = 2,304 PF.

Hi, your EPF deduction calculation is as follows:

New PF Deduction Calculation

If your salary is 15,000 or more, the PF is calculated on 15,000.

- Employee Contribution: 15,000 * 12% = 1,800
- Employer Contribution: 15,000 * 12% = 1,800
- EDLI Charges @ 1.61%: 15,000 * 1.61% = 241.5

Your total PF deduction is: 1,800 + 1,800 + 241.50 = 3,842.