Dear Seniors, presently, we are deducting EPF for all employees up to Rs. 15,000 Basic & DA. However, from 1st April 2022 onwards, we plan to deduct EPF up to a salary of 15k (excluding HRA). Employees with a salary exceeding 15k (excluding HRA) will not be eligible for EPF deductions. This change will be effective from 01.04.2022, and the existing employees' contributions will remain the same.
Is this legally acceptable? Please advise.
**Location**: Bangalore, India
epf calculation, Country-India, City-India-Bangalore
From India , Bangalore
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1Is this legally acceptable? Please advise.
**Location**: Bangalore, India
epf calculation, Country-India, City-India-Bangalore
From India , Bangalore
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As per the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, the EPF wage limit is set at Rs. 15,000. However, the Act specifies that the wage for EPF calculation includes basic pay, dearness allowance (DA), and retaining allowance, if any. HRA is not considered for EPF calculation.
Given your scenario where you plan to deduct EPF for all employees up to Rs. 15,000 salary (excluding HRA) from 1st April 2022, this approach aligns with the legal provisions. Employees with a salary exceeding Rs. 15,000 (excluding HRA) will not be eligible for EPF deductions as per your new policy.
To implement this change effectively, ensure clear communication to all employees regarding the revised EPF deduction criteria. Update the payroll system to reflect the new EPF deduction structure accurately from the specified date. It's crucial to maintain compliance with the EPF regulations and accurately calculate contributions based on the revised wage limit.
Consult with your legal team or labor law experts to ensure full compliance with the EPF regulations and any specific guidelines applicable in Bangalore, India. Regularly review and update your policies to align with any changes in labor laws or regulations to avoid any non-compliance issues.
From India, Gurugram
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Given your scenario where you plan to deduct EPF for all employees up to Rs. 15,000 salary (excluding HRA) from 1st April 2022, this approach aligns with the legal provisions. Employees with a salary exceeding Rs. 15,000 (excluding HRA) will not be eligible for EPF deductions as per your new policy.
To implement this change effectively, ensure clear communication to all employees regarding the revised EPF deduction criteria. Update the payroll system to reflect the new EPF deduction structure accurately from the specified date. It's crucial to maintain compliance with the EPF regulations and accurately calculate contributions based on the revised wage limit.
Consult with your legal team or labor law experts to ensure full compliance with the EPF regulations and any specific guidelines applicable in Bangalore, India. Regularly review and update your policies to align with any changes in labor laws or regulations to avoid any non-compliance issues.
From India, Gurugram
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