Understanding EPF Deductions: Why Do Companies Use Different Salary Components?

loganathan.
Hi Sir, could someone please clarify why some companies deduct EPF from basic salary + DA, while others deduct it from all salary components excluding HRA? My question is regarding the correct process as per the government gazette notification.

Regards, P. Loganathan - HR
vmlakshminarayanan
Hi, If Basic + DA is equal to or above the PF wage ceiling of Rs. 15,000/-, then there is no need to consider other components of Gross, excluding HRA, for PF deduction. Therefore, for such cases, only Basic + DA is considered for PF deduction.

Additionally, employees and employers, with mutual consent, can contribute to PF based on the actual Basic + DA, even if the total exceeds Rs. 15,000/-.
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