Dear Members, can PF deducted to the employees who’s gross salary is 5000 rs/mnth.. Plz suggest me about this... Regards, Vaniananth
From India, Mangaluru
Acknowledge(0)
Amend(0)
From India, Mangaluru
Acknowledge(0)Amend(0)
Yes, PF is applicable to all employees whose Basic + DA is up to Rs. 6,500/-. Employees drawing Basic + DA more than Rs. 6,500/- can opt out of the scheme. Hope your query is resolved.
Regards,
Manasi
From India, Thana
Acknowledge(0)Amend(0)
16Regards,
Manasi
From India, Thana
Acknowledge(0)Amend(0)
Hi all, if an employee is receiving a gross salary of Rs. 5000/-, first, you have to check whether it is below or above the minimum wages. If it is below the minimum wage, then give a hike and increase their salary to the minimum wage. On that minimum wage, you can deduct the PF. The minimum wage cannot be split, and I am attaching the necessary document for your perusal.
Regards,
Siva Kumar Tata
From India, Hyderabad
Acknowledge(0)Amend(0)
Regards,
Siva Kumar Tata
From India, Hyderabad
Acknowledge(0)Amend(0)
Dear Ashwinee, I am also looking for an answer to the same query. As discussed with a few, if someone is already a member of PF, there is no way to opt out. You can only restrict new enrollments in PF if their Basic+DA is up to 6500.
I hope I am correct. I would request seniors to respond if there is something wrong.
Regards, Saunee
From India, New Delhi
Acknowledge(0)Amend(0)
I hope I am correct. I would request seniors to respond if there is something wrong.
Regards, Saunee
From India, New Delhi
Acknowledge(0)Amend(0)
Hi all, this topic has been elaborately discussed in this forum time and again. What I have learned from them is that if one's salary (Basic + DA) is more than Rs. 6500/-, he may wish to opt out of the PF statutory submission. For this, at his joining, he needs to fill out Form 11 and submit it to the PF office.
Having said the above, in my opinion, it's always better to be a part of the PF contribution as a similar amount is deposited by the company as well, plus the interest per annum. It becomes a huge amount whenever you leave your organization, which you may either withdraw (to repay your loans, if any, or for further reinvestment) or transfer the amount to the next PF account number (preferred). Moreover, you get the tax benefit also on the PF submissions under the Income Tax Act, 1961.
From India, New Delhi
Acknowledge(0)Amend(0)
Having said the above, in my opinion, it's always better to be a part of the PF contribution as a similar amount is deposited by the company as well, plus the interest per annum. It becomes a huge amount whenever you leave your organization, which you may either withdraw (to repay your loans, if any, or for further reinvestment) or transfer the amount to the next PF account number (preferred). Moreover, you get the tax benefit also on the PF submissions under the Income Tax Act, 1961.
From India, New Delhi
Acknowledge(0)Amend(0)
Let me try to clarify your doubts.
General Checklist for Minimum Wages
Minimum Wages:
1. Check the Minimum Wages applicable to your state for Unskilled, Semi-Skilled, and Skilled employees.
2. Check the Basic + DA given to employees as per their skill.
If the Minimum Wages Act is not followed, the following steps should be taken:
a.) For employees drawing a Gross Salary less than the minimum wages: Basic + DA should be equal to Gross Salary, i.e., no bifurcation in the salary is possible.
E.g., Employee Gross is Rs. 2500/- (below minimum wages); hence the Basic + DA = Rs. 2500/-
PF Applicability: Rs. 2500/-
b.) Take necessary steps to hike the salary as per minimum wages.
For employees whose Gross Salary is high but Basic + DA is not as per Minimum Wages:
b.) Restructure the Salary as we cannot bifurcate the Minimum Wages.
E.g.: Basic + DA = Amount equal to or more than Minimum Wages
Other Allowances = Remaining Amount
(You can add Allowances as per the need)
PF Applicability:
1. Where Basic + DA is up to 6500/-, PF would be deducted up to Rs. 6500/-
2. Where Basic + DA is more than 6500/-, PF would be deducted on Rs. 6500/- or on the whole Basic, as per company policy.
An employee once enrolled in a company under the PF Scheme cannot opt out of the Scheme even if his Basic is incremented. He can only opt out of the PF Scheme when he joins a new company where his Basic + DA is more than 6500/-. For opting out, he needs to fill Form 11. No other procedure is involved.
Here, Parul has rightly mentioned the benefits of continuing PF; hence, in my view, PF should be continued by transferring the funds.
Hope this clears your doubts. Please feel free to write back.
Regards
From India, Thana
Acknowledge(0)Amend(0)
General Checklist for Minimum Wages
Minimum Wages:
1. Check the Minimum Wages applicable to your state for Unskilled, Semi-Skilled, and Skilled employees.
2. Check the Basic + DA given to employees as per their skill.
If the Minimum Wages Act is not followed, the following steps should be taken:
a.) For employees drawing a Gross Salary less than the minimum wages: Basic + DA should be equal to Gross Salary, i.e., no bifurcation in the salary is possible.
E.g., Employee Gross is Rs. 2500/- (below minimum wages); hence the Basic + DA = Rs. 2500/-
PF Applicability: Rs. 2500/-
b.) Take necessary steps to hike the salary as per minimum wages.
For employees whose Gross Salary is high but Basic + DA is not as per Minimum Wages:
b.) Restructure the Salary as we cannot bifurcate the Minimum Wages.
E.g.: Basic + DA = Amount equal to or more than Minimum Wages
Other Allowances = Remaining Amount
(You can add Allowances as per the need)
PF Applicability:
1. Where Basic + DA is up to 6500/-, PF would be deducted up to Rs. 6500/-
2. Where Basic + DA is more than 6500/-, PF would be deducted on Rs. 6500/- or on the whole Basic, as per company policy.
An employee once enrolled in a company under the PF Scheme cannot opt out of the Scheme even if his Basic is incremented. He can only opt out of the PF Scheme when he joins a new company where his Basic + DA is more than 6500/-. For opting out, he needs to fill Form 11. No other procedure is involved.
Here, Parul has rightly mentioned the benefits of continuing PF; hence, in my view, PF should be continued by transferring the funds.
Hope this clears your doubts. Please feel free to write back.
Regards
From India, Thana
Acknowledge(0)Amend(0)
Although the employee's salary is below the minimum wage, we should still deduct PF. If the employer does not provide a salary in accordance with the Minimum Wages Act, it is considered a violation. Regardless of the circumstances, we must deduct PF from the salary.
With Regards,
Vineet Deshmukh
From India, Yavatmal
Acknowledge(0)Amend(0)
With Regards,
Vineet Deshmukh
From India, Yavatmal
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
PF Contribution on not less than Minimum Wage.pdf