Hello everyone, under the new wage code which will be applicable from April 2021, are the PF rules the same as the earlier ones? Can we still have a capping of ₹15,000 basic salary with a 12% PF deduction, or have the rules changed as per the new wage code? Please guide me on this.
From India, Delhi
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1From India, Delhi
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PF Rules and New Wage Code Impact
The PF rules remain the same, maintaining a capping of ₹15,000. However, the department will monitor the records of employees who receive gross wages below ₹15,000 to ensure that the difference between gross wages and EPF wages paid is based on genuine facts. If discrepancies are found, they will request contributions for that portion of payment.
Impact of the New Wage Code
The new wage code impacts more than just PF; its overall effect will be on annual income tax (TDS), potentially leading to many allowances becoming taxable. Additionally, terminal benefits such as gratuity and EL encashment will be higher for employees.
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The PF rules remain the same, maintaining a capping of ₹15,000. However, the department will monitor the records of employees who receive gross wages below ₹15,000 to ensure that the difference between gross wages and EPF wages paid is based on genuine facts. If discrepancies are found, they will request contributions for that portion of payment.
Impact of the New Wage Code
The new wage code impacts more than just PF; its overall effect will be on annual income tax (TDS), potentially leading to many allowances becoming taxable. Additionally, terminal benefits such as gratuity and EL encashment will be higher for employees.
Thank you.
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Hello Everyone Kindly advice if an employee can opt out from PF if his basic salary gets increased beyond 15,000 (who is currently a PF member).
From India, Delhi
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From India, Delhi
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If he is currently a PF member, and if his salary is increased beyond Rs.15000/-, his contribution (+employer’s) towards PF shall be continued to be made, as if his salary is Rs.15000/-.
From India, Aizawl
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From India, Aizawl
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New Wage Code and PF Contributions
The new wage code has been introduced to update changes in pay structures and has no concern with PF contributions. The capping continues to be 12% of gross wages (excluding HRA and standard allowances) up to ₹1,800 per month.
From India, Mumbai
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The new wage code has been introduced to update changes in pay structures and has no concern with PF contributions. The capping continues to be 12% of gross wages (excluding HRA and standard allowances) up to ₹1,800 per month.
From India, Mumbai
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Wage-ceiling-ep f-6500-15000-ci rcular-circular .pdf