Is There a Notice Before PF Deduction from Gross Salary? Let's Discuss!

Dear friends,

Is there any kind of notice that PF will be deducted from the gross salary?

What is your gross salary? If it is less than 15000, then PF will be deducted on the gross salary; otherwise, 12% of 15000.

Provident Fund Deduction Clarification

PF is deducted on Basic + DA, not on gross salary, if I am not wrong.

The employees who were drawing a salary beyond Rs. 6,500/- per month (p.m.) and less than Rs. 15,000/- p.m. were excluded employees within the meaning of Para 2(f) of the Employees’ Provident Funds Scheme (EPF Scheme), 1952, up to 31st August 2014. Consequent upon the enhancement of the wage ceiling to Rs. 15,000/- per month, all such employees have become eligible to be members of the Fund from 1st September 2014. EPF contribution in respect of such employees for the wage month of September 2014 is payable by 15th October 2014.

Components of Emoluments

Emoluments, for the purposes of reckoning the wage ceiling of Rs. 15,000/- p.m., means all components of emoluments payable in cash to an employee during the month, excluding:
- House Rent Allowance
- Over Time Allowance
- Bonus
- Commission or similar allowance
- Any presents made by the employer

For example:
- Employee A: Basic wage 12,000, Dearness Allowance 3,000, Retaining Allowance -, House Rent Allowance 2,000, Over Time Allowance 1,000, Bonus 2,000, Conveyance Allowance 5,000, Presents -. Employee A is eligible for membership of the Fund as basic wages and dearness allowance are Rs. 15,000/- or less p.m.

- Employee B: Basic wages 13,000, Dearness Allowance 3,000, Retaining Allowance -, House Rent Allowance 1,000, Over Time Allowance 2,000, Bonus 1,000, Conveyance Allowance 5,000, Presents -. Employee B is not eligible for membership of the Fund as basic wages and dearness allowance are above Rs. 15,000/- p.m.

For more details, please refer to the EPFO website.

No, it's not like that. Based on the wage structure, it will also differ. For example, HRA is exempted for EPF.

Dear Mr. Sandeep,

Please do not write incorrect information and confuse other members if you are not sure about the act.

Dear Manoj,

PF should be deducted only on Basic + DA, not on the gross salary. However, whoever's gross salary is less than ₹15,000 are to be covered under the act compulsorily. Please refer to the EPF Act at the below link and read section 2(b):

http://www.epfobbs.gov.in/pdf/EPF%20and%20MP%20Act,%201952.pdf

Thank you.

There is a court decision by some high courts that PF will be deducted, including all allowances. However, there are other high court decisions that go the other way. The Supreme Court will soon be giving its decision on the matter.

Meanwhile, there is an amendment proposed by the central government to amend the PF Act, after which all PF deductions will be based on gross wages. However, this is just a proposal and has not even been introduced in Parliament. You, therefore, need to await a formal announcement when the act gets passed.

Dear Mr. Pilania,

The question is whether PF deduction should be based on the gross salary, including allowances, or on the basic pay, excluding allowances.

I. M. ANAND

I had already posted a thread about UAN numbers, but didn't get a reply from anyone. Part-time employees have been allotted multiple UAN numbers. How can they combine them into one UAN number? If an entry is made with one UAN number from a previous membership site, the demand date of leaving from the previous employer, where they are currently working, and paying PF on that UAN number.

I.M. ANAND

Please be well-informed on computing wages for deductions for eligible members for PF. This aspect is very critical from all points of view.

Friends, none of any member has been confirmed about my UAN number query to combine multiple UAN numbers issued to part-time EPF members. Is there no confirmation about it? I had already been in touch with EPF UAN services by phone and email, but didn't receive a satisfactory reply. The only response that matters has been referred to higher authorities.

I. M. ANAND