Is PF Mandatory for Mr. A? Understanding Applicability on Gross Pay vs. Basic Salary

JyothisKVJ
PF applicability needs to be checked on which amount: Gross pay or Basic Salary.

For instance, the Basic Salary of Mr. A is Rs. 12,000, DA- Rs. 2000, Additional Allowance- Rs. 4000. So, the Gross Pay comes to Rs. 18,000. Is PF mandatory for Mr. A?
stephen_7
Yes. PF needs to be covered for the employees who have basic + DA less than 15k. In your case, Mr. A's basic + DA is 14k. So he is covered under the act.
JyothisKVJ
My doubt is to check mandatory PF applicability, do we have to consider an employee's wages in total or Basic salary alone (as per EPF Act)? Contribution is okay, which is limited to ₹15,000 of Basic + DA. Can anyone share the exact section of EPF explaining on which amount EPF applicability should be checked:

1. Basic Salary Alone
2. Basic + DA + Retaining Allowance
3. Gross Pay
sumitk.saxena
Dear sir,

Greetings for the day.

For calculation of EPF accumulation, the basic+da+food conc. (if any) is required. No other allowance is required if the salary structure is like Basic+HRA+Cony.+Other Allowance. The component of basic will be considered, and the rest will not.

Thanks & Regards,

Sumit Kumar Saxena
bijay_majumdar
PF applicability on the sum of basic and DA upper limit for the PF application is ₹15,000. However, if the employees have already been members, they continue to be PF members irrespective of the limit as indicated.
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