Hi friends,
Please let me know whether any judgments have been made regarding including LTA in salary for PF contributions. I have encountered a situation where it is included in some cases and not in others. I would be grateful if anybody could clarify this.
Thank you.
From India, Hyderabad
Acknowledge(0)
Amend(0)
Please let me know whether any judgments have been made regarding including LTA in salary for PF contributions. I have encountered a situation where it is included in some cases and not in others. I would be grateful if anybody could clarify this.
Thank you.
From India, Hyderabad
Acknowledge(0)Amend(0)
The definition in the act is very clear - salary is basic and DA only. There is a case pending before the Supreme Court which is for reinterpretation of the definition. Till it happens, the LTA is not a part of PF contribution.
From India, Mumbai
Acknowledge(0)Amend(0)
2500From India, Mumbai
Acknowledge(0)Amend(0)
LTA is an annual component of employee remuneration. There is no chance that it will form part of salary even if the definition of wages under the EPF & MP Act is amended and all emoluments received while on employment are brought under the definition of wages on which PF is to be contributed.
Normally LTA will be equal to one month’s basic salary and by including it in any month, naturally, the PF qualifying salary would increase and perhaps crosses Rs 15000. Since PF Organisation is under no right to demand contribution on an amount above Rs 15000, the significance of its inclusion is very limited.
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
Normally LTA will be equal to one month’s basic salary and by including it in any month, naturally, the PF qualifying salary would increase and perhaps crosses Rs 15000. Since PF Organisation is under no right to demand contribution on an amount above Rs 15000, the significance of its inclusion is very limited.
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
You have not mentioned what are the components under the 'salary' you meant/noticed in these cited cases. There could hardly be any such employer who would be eager to pay PF contribution on any other allowances beyond Basic & DA. That's why I doubt whether you properly understood what was happening in these instances/ inquisitive to you.
LTA (Leave Travel Allowance) is enjoyed by employees in more than one form. The popular form is 'spend & get reimbursed subject to eligibility norms' and the second one is 'paid lump sum periodically' and the third 'paid through' salary monthly' and so on. And in none of these cases PF contribution is subjected to. Frankly, I could not believe any such employer exists, if yes please let me know.
It's yet another case where CTC pattern is followed. As you may know, LTA forms part of CTC but unlikely accounts for PF contribution. You may explore the cases you have come across further to ascertain the circumstances they are acting upon for knowledge sake though legally PF contribution on LTA, no way. There is no judgment to support PF contribution on LTA, to my knowledge so far.
From India, Bangalore
Acknowledge(0)Amend(0)
LTA (Leave Travel Allowance) is enjoyed by employees in more than one form. The popular form is 'spend & get reimbursed subject to eligibility norms' and the second one is 'paid lump sum periodically' and the third 'paid through' salary monthly' and so on. And in none of these cases PF contribution is subjected to. Frankly, I could not believe any such employer exists, if yes please let me know.
It's yet another case where CTC pattern is followed. As you may know, LTA forms part of CTC but unlikely accounts for PF contribution. You may explore the cases you have come across further to ascertain the circumstances they are acting upon for knowledge sake though legally PF contribution on LTA, no way. There is no judgment to support PF contribution on LTA, to my knowledge so far.
From India, Bangalore
Acknowledge(0)Amend(0)Gathering data for an AI comment.... Sending emails to relevant members...
Join Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.
Legal Clarification on Termination for Criminal Case & PF Contribution Reduction.pdf
Salary Sheet & PF PT Calculation & Challan Nov 2010.xls