Dear All,
Can anyone guide me on how to calculate Superannuation? If an employee leaves the organization, how much will they receive as a superannuation amount?
If an employee leaves the organization, how much will they receive as PF amount? Can the employee withdraw the full PF amount (12% from employees and 12% from employers)? If yes, what would be the tax and interest implications? If not, what is the mode of PF payment?
Regards,
Aradhana
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Can anyone guide me on how to calculate Superannuation? If an employee leaves the organization, how much will they receive as a superannuation amount?
If an employee leaves the organization, how much will they receive as PF amount? Can the employee withdraw the full PF amount (12% from employees and 12% from employers)? If yes, what would be the tax and interest implications? If not, what is the mode of PF payment?
Regards,
Aradhana
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An employee getting superannuated will be paid as per the policy of the company. If no superannuation policy exists, then he is eligible only for Gratuity provided he has at least 5 years of service with the organization. Gratuity will be equal to 15 days' salary for every completed year of service, and any fraction of a year exceeding six months shall be rounded to the next higher figure. Salary for the calculation means the last salary drawn. However, if due to any reason he was on loss of pay leave and could not get his full pay, an average pay or the pay which would have been paid had he worked all the days shall be taken as salary.
In addition to the above, an employee will get PF benefits which will include 12% of his share plus 3.67% of the employer's share with interest. If he has put in more than 10 years of service, he will not get the withdrawal benefit of the rest 8.33% of the employer's share, but he will be eligible for a monthly pension from EPFO.
Regards, Madhu.T.K
From India, Kannur
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4526In addition to the above, an employee will get PF benefits which will include 12% of his share plus 3.67% of the employer's share with interest. If he has put in more than 10 years of service, he will not get the withdrawal benefit of the rest 8.33% of the employer's share, but he will be eligible for a monthly pension from EPFO.
Regards, Madhu.T.K
From India, Kannur
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Dear Ardhana,
Madhu Sir is absolutely correct, but for your reference, I have attached a document on superannuation.
Superannuation is a retirement benefit given to employees by the employer. Normally, the company has a link with agencies like LIC Superannuation Fund, where their contributions are paid.
The company usually pays 15% of basic wages as superannuation contribution, with no contribution required from the employee. It can range from 15% to 27%, if I'm not mistaken.
The contribution is invested by the fund in various securities as per the prescribed investment pattern.
Interest on investment is credited to the member's account. Normally, the rate of interest is equal to the PF interest rate.
Upon attaining the retirement age, the member is eligible to take 25% of the balance available in his/her account as a tax-free benefit. The remaining 75% is put in an annuity fund, and the LIC agency will pay the member monthly/quarterly/periodical returns based on the option exercised by the member.
This income is taxable. In the case of an employee's resignation, the employee has the option to transfer the amount to the new employer. If the new employer does not have a superannuation scheme, then the employee can withdraw the amount, subject to deduction of tax and approval of the Income Tax Department, or retain the amount in the fund until the superannuation age.
If I missed something, treat me as another imperfect human being.
Regards,
Vipin
From India, New Delhi
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Madhu Sir is absolutely correct, but for your reference, I have attached a document on superannuation.
Superannuation is a retirement benefit given to employees by the employer. Normally, the company has a link with agencies like LIC Superannuation Fund, where their contributions are paid.
The company usually pays 15% of basic wages as superannuation contribution, with no contribution required from the employee. It can range from 15% to 27%, if I'm not mistaken.
The contribution is invested by the fund in various securities as per the prescribed investment pattern.
Interest on investment is credited to the member's account. Normally, the rate of interest is equal to the PF interest rate.
Upon attaining the retirement age, the member is eligible to take 25% of the balance available in his/her account as a tax-free benefit. The remaining 75% is put in an annuity fund, and the LIC agency will pay the member monthly/quarterly/periodical returns based on the option exercised by the member.
This income is taxable. In the case of an employee's resignation, the employee has the option to transfer the amount to the new employer. If the new employer does not have a superannuation scheme, then the employee can withdraw the amount, subject to deduction of tax and approval of the Income Tax Department, or retain the amount in the fund until the superannuation age.
If I missed something, treat me as another imperfect human being.
Regards,
Vipin
From India, New Delhi
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Dear Mr. Vipin,
Do you mean to say if the superannuation is mentioned in the increment letter and the person has resigned, I will have to pay the superannuation amount, or can I say no to the person? What is legal?
If I have to pay him, do I have to follow the below formula, e.g., Last Basic x 12 x 15%? If not, then please provide the right formula.
Thanks in advance,
Raj
From India
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Do you mean to say if the superannuation is mentioned in the increment letter and the person has resigned, I will have to pay the superannuation amount, or can I say no to the person? What is legal?
If I have to pay him, do I have to follow the below formula, e.g., Last Basic x 12 x 15%? If not, then please provide the right formula.
Thanks in advance,
Raj
From India
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sir , i am a student of HR . Can you tell me the basic difference between superannuation and retirement.
From India, Ranchi
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From India, Ranchi
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I was covered under supeannuation for 5 years. Since I resigned, the past employer says that I am not eligible to claim the superannuation benefits accrued on my account. Is it legally tenable?
From India, Lucknow
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From India, Lucknow
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Legally, you are eligible for gratuity since you have only worked for 5 years. The superannuation fund is an arrangement by the employer to pay the employee an amount upon their leaving the organization after reaching the age of superannuation as provided in the standing orders of the organization.
Regards,
Madhu.T.K
From India, Kannur
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Regards,
Madhu.T.K
From India, Kannur
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Help Needed: PF Withdrawal Query
If an employee who was receiving PF earlier has completed 60 years of age and has started receiving superannuation benefits along with a promotion, and has stopped his PF contributions, can he go for PF money withdrawal? The employee is still continuing service with the same organization.
Thanks
From India, Suratgarh
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If an employee who was receiving PF earlier has completed 60 years of age and has started receiving superannuation benefits along with a promotion, and has stopped his PF contributions, can he go for PF money withdrawal? The employee is still continuing service with the same organization.
Thanks
From India, Suratgarh
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