EPF Inspection Queries
Today, we had an EPF inspection at our office premises. During the inspection, certain queries were put forth:
1. One of our vendors hasn't paid PF or opened PF accounts for their employees (we are paying the vendor the total sum along with the PF contribution). Now, the PF Inspector has asked us to pay the amount as we are the principal employer.
2. The basic pay is 33% of the gross pay in our organization. The officer has requested clarification on this.
3. Trainees who join us will be paid a stipend for the first year (Rs 16,500). We calculate and pay PF based on the entire stipend. In the following year, when the trainees are converted to regular employees (the basic pay is less than the stipend, Rs 7,000), we pay for the basic. The question arises as to why we start paying the pension only in the second year. Despite explaining that the basic is lower in the second year, so we commence deducting the pension, the officer has requested further clarification.
Please help me understand and resolve these issues.
From India, New Delhi
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8Today, we had an EPF inspection at our office premises. During the inspection, certain queries were put forth:
1. One of our vendors hasn't paid PF or opened PF accounts for their employees (we are paying the vendor the total sum along with the PF contribution). Now, the PF Inspector has asked us to pay the amount as we are the principal employer.
2. The basic pay is 33% of the gross pay in our organization. The officer has requested clarification on this.
3. Trainees who join us will be paid a stipend for the first year (Rs 16,500). We calculate and pay PF based on the entire stipend. In the following year, when the trainees are converted to regular employees (the basic pay is less than the stipend, Rs 7,000), we pay for the basic. The question arises as to why we start paying the pension only in the second year. Despite explaining that the basic is lower in the second year, so we commence deducting the pension, the officer has requested further clarification.
Please help me understand and resolve these issues.
From India, New Delhi
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Dear Anamika,
Regarding question #3, trainees are not covered under EPS during the training period since the entry-level EPF wages are more than Rs15,000/- per month and there is no previous EPS membership.
After the completion of the training period, even though their EPF wages are less than Rs15,000/- per month, they should not be covered under EPS. EPS contributions at 8.33% should be remitted in the Employer EPF Contribution column.
Please revert with your comments.
From India, New Delhi
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Regarding question #3, trainees are not covered under EPS during the training period since the entry-level EPF wages are more than Rs15,000/- per month and there is no previous EPS membership.
After the completion of the training period, even though their EPF wages are less than Rs15,000/- per month, they should not be covered under EPS. EPS contributions at 8.33% should be remitted in the Employer EPF Contribution column.
Please revert with your comments.
From India, New Delhi
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EPF EXEMPTION FOR TRAINEES CIRCULAR 427.pdf