Understanding PF Ceiling: Can Basic Salary Exceed ₹15,000 with a Fixed PF Contribution?

Need some help while preparing the salary breakup.

PF Ceiling and Basic Salary

1) If the PF ceiling is there (₹1800), can the basic be above ₹15,000?

2) Is it necessary to keep the PF contribution at 12% of the basic, or can I keep the PF contribution at ₹1800 and the basic could be any amount greater than ₹15,000?

Provident Fund Deduction Limits

The statutory limit for Provident Fund deduction is Rs. 15,000/- (salary), which translates to Rs. 1,800/- as PF contribution. You have the freedom to deduct above Rs. 15,000/- and remit it to the PF fund, but that will apply only to the employees' share. The employer's share is fixed at 12% of Rs. 15,000/- salary only.

Hi there, I can help you with preparing the salary breakup.

1) If the PF ceiling is at 1800/-, can the basic be above 15000/-?
The basic can indeed be above 15K. When calculating PF, we clearly mention the EPF Wages and EPS wages, which are limited to 15K.

2) Is it necessary to keep the PF contribution at 12% of the basic? Or can I keep the PF contribution at 1800/- and have the basic be any amount greater than 15000/-?
PF is typically calculated on Basic + DA. Due to the Minimum Wages Act, the basic and DA should fall within the minimum wages limit.

Please let me know if you need further assistance with this.