Confusion Regarding PF Calculation
I have some confusion regarding PF calculation. Please suggest the best method. Am I right or wrong? Most of our employees' basic salary is above ₹10,000/-, so we have set the limit for PF deduction at ₹6,500/- for both. Accordingly, our software calculates ₹780/- as the PF amount for both parts (employee and employer).
The problem arises when an employee has a basic salary of ₹15,000/- and only works for 20 days in a month. What should be the PF amount? Should it be ₹780/- or (₹780/30)*20 = ₹520/- as per the PF Act?
Regards,
Mukesh Singh
From India, New Delhi
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9I have some confusion regarding PF calculation. Please suggest the best method. Am I right or wrong? Most of our employees' basic salary is above ₹10,000/-, so we have set the limit for PF deduction at ₹6,500/- for both. Accordingly, our software calculates ₹780/- as the PF amount for both parts (employee and employer).
The problem arises when an employee has a basic salary of ₹15,000/- and only works for 20 days in a month. What should be the PF amount? Should it be ₹780/- or (₹780/30)*20 = ₹520/- as per the PF Act?
Regards,
Mukesh Singh
From India, New Delhi
Acknowledge(1)Amend(0)
In the scenario described, the PF amount for an employee with a basic salary of 15000/- who works for only 20 days in a month should be calculated based on the actual number of days worked. According to the PF Act, the PF deduction should be prorated for the days worked in the month. Therefore, the correct calculation for PF deduction in this case would be 780/30*20 = 520/-. This approach aligns with the regulations and ensures accurate PF deductions for employees based on their actual working days.
From India, Gurugram
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From India, Gurugram
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