Dear Forum Members, whether Statutory dedcuctions like PF /ESI/PT is applicable for if any compensation paid to the employees Thanks, Rajesh N
From India, Hyderabad
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4From India, Hyderabad
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If by compensation payable you mean retrenchment compensation, then ESI or EPF need not be deducted since it is not earned by the employee by working in the company. At the same time, since it is an income in the hands of the employee, profession tax, which is paid on the income and not on the 'salary' of the employee, should be deducted from the amount of retrenchment compensation.
Regards,
Madhu.T.K
From India, Kannur
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Regards,
Madhu.T.K
From India, Kannur
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Rules for Statutory Deductions Exemptions Perquisites-Pay roll.doc