Confused About PF Deductions in 2016? Let's Break Down the Salary Calculation Together

venkateshhrm@yahoo.in
Hi, can anyone help me understand the preset percentage of PF deductions in companies? It seems that different companies have started varying deductions in salaries, claiming it to be in accordance with the new rule of 2016 where PF deductions have supposedly increased. I am quite confused about this. Below, I have provided my colleague's salary breakdown for reference: Gross is 21000 and Basic 20%, HRA 20%, Conveyance 10%, LTA 10%, Medical 10%, Others 10%, and FBP 20%.

The deduction part includes PF, gratuity, and meal coupons (although he is not registered for meal coupons). The PF percentage is 12%, but I am unsure if this has changed. Currently, he is receiving 17789 after a deduction of 3000 from the gross amount. Is this calculation correct? Please help me understand this better.

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HR Mohankumar
Hi Venkat,

Basic should be 50%, HRA 25-30%, conveyance 1600, medical 1250 (max), and the balance in special pay. PF should be 12% of basic. Gratuity should not be deducted from the gross. For more details, inbox me.
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