Hi all, Please someone help out me, How are calculate the PF, Gratuity and ESI? In this process of calculations, which basis they calculate contribution? Someone help me on these calculations
From India, Gurgaon
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14From India, Gurgaon
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Dear Prasad, Huge Discussions are there regarding this topic. You can use research tab. Even then if you can’t clarify your query, then we can have a discuss.
From India, Madras
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From India, Madras
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Bharathi mam, i want procedure caluculation of salary of individual person..............take some amount explain me ,,,,,,,i want to know procedure. pleaseeeeeeeeeeee
From India, Gurgaon
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From India, Gurgaon
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Salary breakup is:
Basic: 1000
DA: 500
HRA: 400
Others: 1000
Gross Salary: 2900
For PF:
**
(Basic + DA) * 12% means: (1000 + 500) / 100 * 12 (same from the company) and other administrative charges 1.61%
Max up to 6500/-
For ESI:
**
Gross salary * 1.75%
From employee salary deduction means: 2900 / 100 * 1.75
From Employer: 2900 / 100 * 4.25
Max up to 15000/-
For more details, see the............
Regards
From India, Vijayawada
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Basic: 1000
DA: 500
HRA: 400
Others: 1000
Gross Salary: 2900
For PF:
**
(Basic + DA) * 12% means: (1000 + 500) / 100 * 12 (same from the company) and other administrative charges 1.61%
Max up to 6500/-
For ESI:
**
Gross salary * 1.75%
From employee salary deduction means: 2900 / 100 * 1.75
From Employer: 2900 / 100 * 4.25
Max up to 15000/-
For more details, see the............
Regards
From India, Vijayawada
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Dear Prasad Subject - How calculate PF, Gratuity and ESI........... Please see the formula of sheet attachment for some .... more you need to discuss. Regards Vinod Chauhan Consultant New Delhi
From India, Delhi
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From India, Delhi
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Hi sir,
What are the contribution periods and what are the benefit periods in the ESI act? In the Provident Fund, how do we calculate PF, pension fund, and DIL? If you have any materials on ESI, PF, Gratuity, and Superannuation acts, please share them.
Thank you.
From India, Gurgaon
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What are the contribution periods and what are the benefit periods in the ESI act? In the Provident Fund, how do we calculate PF, pension fund, and DIL? If you have any materials on ESI, PF, Gratuity, and Superannuation acts, please share them.
Thank you.
From India, Gurgaon
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Hi all, what is the difference between gratuity fund and superannuation fund?pls someone give information............
From India, Gurgaon
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From India, Gurgaon
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Dear Prasad,
Difference between Gratuity and Superannuation fund:
Superannuation is 15% of basic, and gratuity is 4.81% of the basic.
Superannuation can be optional (you can opt in your hand salary as a special allowance which will be taxable) while gratuity is not.
Superannuation can be claimed whenever you leave the company while Gratuity can only be claimed if you have completed 5 years.
Both terms have different meanings and are used differently, and therefore should not be confused with each other.
In India, Superannuation is a perquisite extended to employees in various companies as a part of employment conditions generally to the management staff more for retention purpose. It had more significance some years ago as it entailed retirement benefit on attaining the age of superannuation - say 58 years, as companies in the private sectors do not have pension schemes unlike Government Sector companies.
The superannuation started getting significance as many multinational companies offered this perquisite which even allows a deduction of up to 15% of basic and in combination with PF should not go beyond 27% as per existing rules under the Income Tax provisions.
The superannuation can be prescribed through LIC or many other private insurance companies, and a number of options may be chosen from the scheme by employees who are members at the time of leaving the company.
Whereas Gratuity is compulsory under the provisions of The Payment of Gratuity Act after an employee completes 5 years of service with the company. Gratuity becomes payable only on completion of 5 years only.
1. Superannuation is a defined contribution plan.
2. Gratuity is a defined benefit plan.
1. Superannuation is an employee's contribution.
2. Gratuity is an employer's contribution.
1. The employee can withdraw 1/3 of the Superannuation Fund as tax-free income and with the rest of 2/3, he has to buy an annuity plan (pension plan).
2. 100% of the Gratuity amount is Income Tax-Free and can be received in one go.
1. Superannuation is not a statute.
2. Gratuity is a statute.
1. Superannuation can be withdrawn at any time (leaving the company or retiring).
2. Gratuity can be received only when you complete 5 years of continuous service.
From India, Madras
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Difference between Gratuity and Superannuation fund:
Superannuation is 15% of basic, and gratuity is 4.81% of the basic.
Superannuation can be optional (you can opt in your hand salary as a special allowance which will be taxable) while gratuity is not.
Superannuation can be claimed whenever you leave the company while Gratuity can only be claimed if you have completed 5 years.
Both terms have different meanings and are used differently, and therefore should not be confused with each other.
In India, Superannuation is a perquisite extended to employees in various companies as a part of employment conditions generally to the management staff more for retention purpose. It had more significance some years ago as it entailed retirement benefit on attaining the age of superannuation - say 58 years, as companies in the private sectors do not have pension schemes unlike Government Sector companies.
The superannuation started getting significance as many multinational companies offered this perquisite which even allows a deduction of up to 15% of basic and in combination with PF should not go beyond 27% as per existing rules under the Income Tax provisions.
The superannuation can be prescribed through LIC or many other private insurance companies, and a number of options may be chosen from the scheme by employees who are members at the time of leaving the company.
Whereas Gratuity is compulsory under the provisions of The Payment of Gratuity Act after an employee completes 5 years of service with the company. Gratuity becomes payable only on completion of 5 years only.
1. Superannuation is a defined contribution plan.
2. Gratuity is a defined benefit plan.
1. Superannuation is an employee's contribution.
2. Gratuity is an employer's contribution.
1. The employee can withdraw 1/3 of the Superannuation Fund as tax-free income and with the rest of 2/3, he has to buy an annuity plan (pension plan).
2. 100% of the Gratuity amount is Income Tax-Free and can be received in one go.
1. Superannuation is not a statute.
2. Gratuity is a statute.
1. Superannuation can be withdrawn at any time (leaving the company or retiring).
2. Gratuity can be received only when you complete 5 years of continuous service.
From India, Madras
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Hi all, someone give information , what are the contribution period and Benefit period in the ESI act?
From India, Gurgaon
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From India, Gurgaon
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Dear Mr. Prasadu,
The ESI CONTRIBUTION PERIODS ARE -
1. 1st April to 30th Sept
2. 1st October to 31st March
If any employee falls within the ESI Limit (i.e., Rs. 15,000/- gross) during the contribution period, ESI will be deducted until the end of the contribution period, even if his/her salary is increased to above Rs. 15,000/-. The benefit period is the next contribution period.
Regards,
VGKVKM
From India, Bangalore
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The ESI CONTRIBUTION PERIODS ARE -
1. 1st April to 30th Sept
2. 1st October to 31st March
If any employee falls within the ESI Limit (i.e., Rs. 15,000/- gross) during the contribution period, ESI will be deducted until the end of the contribution period, even if his/her salary is increased to above Rs. 15,000/-. The benefit period is the next contribution period.
Regards,
VGKVKM
From India, Bangalore
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Dear Prasadu,
Thank you, VGKVKM, for providing good information. Please give a little more explanation on this topic, i.e., contribution period and benefit period in the ESI Act.
1. Contribution periods under ESI are:
- 1st April to 30th September, and the benefit period for this contribution starts on 1st January to 30th June.
2. Contribution period:
- 1st October to 31st March, and the benefit period for this contribution starts on 1st July to 31st December.
Regards,
Kiran Kale.
From India, Kolhapur
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Thank you, VGKVKM, for providing good information. Please give a little more explanation on this topic, i.e., contribution period and benefit period in the ESI Act.
1. Contribution periods under ESI are:
- 1st April to 30th September, and the benefit period for this contribution starts on 1st January to 30th June.
2. Contribution period:
- 1st October to 31st March, and the benefit period for this contribution starts on 1st July to 31st December.
Regards,
Kiran Kale.
From India, Kolhapur
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Dear I am send sum calculation i hope u useful ESI & PF CALCULATION.
From India, Delhi
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From India, Delhi
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Dear Mr. Prasadu,
I am sorry, Mr. Kiran is correct regarding the benefit period. When I replied quickly, I made a mistake.
Gratuity is payable if an employee completes 5 years of continuous service. Continuous service includes eligible leaves. For each year of service, the employee will receive 15 days of BASIC+DA. The payment is calculated based on 26 working days, i.e., (BASIC+DA)/26*15.
PF is calculated based on BASIC + DA. It is deducted from the employee's monthly salary (Basic+DA) at a minimum of 10% (some private PF funds offer more than 10%). This amount will be deducted from the employee's salary, and they will receive the net of PF as their salary. The employer will also contribute the same percentage towards the employee's PF contribution. Upon retirement, the employee will receive both the employee and employer contributions with interest up to the date. Early withdrawal is also possible. For more details, refer to the PF Act.
Out of the employer's contribution, 8.33% will be allocated to the EPF pension.
From India, Bangalore
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I am sorry, Mr. Kiran is correct regarding the benefit period. When I replied quickly, I made a mistake.
Gratuity is payable if an employee completes 5 years of continuous service. Continuous service includes eligible leaves. For each year of service, the employee will receive 15 days of BASIC+DA. The payment is calculated based on 26 working days, i.e., (BASIC+DA)/26*15.
PF is calculated based on BASIC + DA. It is deducted from the employee's monthly salary (Basic+DA) at a minimum of 10% (some private PF funds offer more than 10%). This amount will be deducted from the employee's salary, and they will receive the net of PF as their salary. The employer will also contribute the same percentage towards the employee's PF contribution. Upon retirement, the employee will receive both the employee and employer contributions with interest up to the date. Early withdrawal is also possible. For more details, refer to the PF Act.
Out of the employer's contribution, 8.33% will be allocated to the EPF pension.
From India, Bangalore
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[QUOTE=VGKNAIRVKM;1683626]
Dear Mr. Prasadu,
I am sorry, Mr. Kiran is correct regarding the benefit period. When I replied quickly, I made a mistake.
Gratuity is payable when an employee completes 5 years of continuous service. Continuous service includes their eligible leaves as well. For each year of service, they will receive 15 days of BASIC+DA. The payment is calculated based on 26 working days, i.e., (BASIC+DA)/26*15.
PF is calculated based on BASIC + DA. It is deducted from the employee's monthly salary (Basic+DA) at a minimum of 10% (some private PF funds offer more than 10%). This deduction will be taken from the employee's salary, and they will receive the net of PF only as salary. The employer will contribute the same percentage towards the employee's PF. Upon retirement, the employee will receive both the employee and employer contributions with interest accrued to date (early withdrawal is also possible).
For more details, refer to the PF ACT.
Out of the employer's contribution, 8.33% will go towards the EPF pension.
Dear VGKNAIR,
I WISH TO EXPLAIN FEW POINTS REGARDING THE EMPLOYEE'S PROVIDENT FUND. THE COVERAGE OF EPF IS STATUTORILY APPLICABLE WHEN THE FIRM HAS 20 EMPLOYEES RECEIVING SALARIES. THE CONTRIBUTION PERCENTAGE IS 12% OF THE SALARY/WAGES, NOT 10%.
FOR UNITS WITH LESS THAN 20 EMPLOYEES WHO CHOOSE TO VOLUNTARILY COVER UNDER THE EPF & MP ACT SECTION 1(4), THE CONTRIBUTION PERCENTAGE IS 10%.
REGARDING WITHDRAWALS, EMPLOYEES WHO LEAVE BEFORE COMPLETING 10 YEARS OF PF SERVICE CAN WITHDRAW THE FULL AMOUNT IN A/C.1 AND A/C.10, RECEIVING INTEREST ONLY ON PF ACCUMULATION (15.67%).
EMPLOYEES WITH 10 YEARS OF SERVICE IN PF/EPS CAN WITHDRAW THE EPF AMOUNT AND ARE ELIGIBLE FOR PENSION AFTER TURNING 58, OR CAN OPT FOR REDUCED PENSION AT AGE 50 WITH A 4% REDUCTION PER YEAR.
I HOPE THIS INFORMATION IS HELPFUL FOR YOU AND OTHERS SEEKING CLARITY.
REGARDS,
KIRAN KALE
From India, Kolhapur
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Dear Mr. Prasadu,
I am sorry, Mr. Kiran is correct regarding the benefit period. When I replied quickly, I made a mistake.
Gratuity is payable when an employee completes 5 years of continuous service. Continuous service includes their eligible leaves as well. For each year of service, they will receive 15 days of BASIC+DA. The payment is calculated based on 26 working days, i.e., (BASIC+DA)/26*15.
PF is calculated based on BASIC + DA. It is deducted from the employee's monthly salary (Basic+DA) at a minimum of 10% (some private PF funds offer more than 10%). This deduction will be taken from the employee's salary, and they will receive the net of PF only as salary. The employer will contribute the same percentage towards the employee's PF. Upon retirement, the employee will receive both the employee and employer contributions with interest accrued to date (early withdrawal is also possible).
For more details, refer to the PF ACT.
Out of the employer's contribution, 8.33% will go towards the EPF pension.
Dear VGKNAIR,
I WISH TO EXPLAIN FEW POINTS REGARDING THE EMPLOYEE'S PROVIDENT FUND. THE COVERAGE OF EPF IS STATUTORILY APPLICABLE WHEN THE FIRM HAS 20 EMPLOYEES RECEIVING SALARIES. THE CONTRIBUTION PERCENTAGE IS 12% OF THE SALARY/WAGES, NOT 10%.
FOR UNITS WITH LESS THAN 20 EMPLOYEES WHO CHOOSE TO VOLUNTARILY COVER UNDER THE EPF & MP ACT SECTION 1(4), THE CONTRIBUTION PERCENTAGE IS 10%.
REGARDING WITHDRAWALS, EMPLOYEES WHO LEAVE BEFORE COMPLETING 10 YEARS OF PF SERVICE CAN WITHDRAW THE FULL AMOUNT IN A/C.1 AND A/C.10, RECEIVING INTEREST ONLY ON PF ACCUMULATION (15.67%).
EMPLOYEES WITH 10 YEARS OF SERVICE IN PF/EPS CAN WITHDRAW THE EPF AMOUNT AND ARE ELIGIBLE FOR PENSION AFTER TURNING 58, OR CAN OPT FOR REDUCED PENSION AT AGE 50 WITH A 4% REDUCTION PER YEAR.
I HOPE THIS INFORMATION IS HELPFUL FOR YOU AND OTHERS SEEKING CLARITY.
REGARDS,
KIRAN KALE
From India, Kolhapur
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Dear Prasad,
For ESIC, it is applicable until your gross salary does not exceed INR 15,000 and the monthly deductions would be 1.75% (employee contribution) and 4.75% (employer contribution).
For example, if my salary is INR 15,000 gross, I am entitled to ESIC. Even if you receive a salary hike in May, your ESIC deductions will continue until September, as ESIC returns are processed half-yearly.
Thank you.
From India, Mumbai
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For ESIC, it is applicable until your gross salary does not exceed INR 15,000 and the monthly deductions would be 1.75% (employee contribution) and 4.75% (employer contribution).
For example, if my salary is INR 15,000 gross, I am entitled to ESIC. Even if you receive a salary hike in May, your ESIC deductions will continue until September, as ESIC returns are processed half-yearly.
Thank you.
From India, Mumbai
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Dear Mr. Kiran,
Thank you for providing more details regarding PF. I would like to clarify that the EPF contribution has been increased from 8.33% to 10%, and for those who were contributing 10%, it has been raised to 12%. I mentioned this briefly in my previous reply.
Upon reviewing your response, I visited the EPF website where they clearly outline the details as follows (ref epfindia.nic.in IN POINT NO 24):
24) What is the voluntary rate of Provident Fund contribution by the member?
According to the Act, the member must contribute at the rate of 10% or 12% of their basic pay, D.A., and retaining allowance if any. If the member wishes to contribute more voluntarily, they can do so at any rate up to 100% of basic and D.A. However, the employer is not obligated to match the enhanced rate.
Regards,
VGKVKM
From India, Bangalore
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Thank you for providing more details regarding PF. I would like to clarify that the EPF contribution has been increased from 8.33% to 10%, and for those who were contributing 10%, it has been raised to 12%. I mentioned this briefly in my previous reply.
Upon reviewing your response, I visited the EPF website where they clearly outline the details as follows (ref epfindia.nic.in IN POINT NO 24):
24) What is the voluntary rate of Provident Fund contribution by the member?
According to the Act, the member must contribute at the rate of 10% or 12% of their basic pay, D.A., and retaining allowance if any. If the member wishes to contribute more voluntarily, they can do so at any rate up to 100% of basic and D.A. However, the employer is not obligated to match the enhanced rate.
Regards,
VGKVKM
From India, Bangalore
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Dear VGKVKM,
Yes, it is true that for those covered under u/s.1(4), the rate of contribution is 10%, as mentioned in the aforementioned point no. 24. I have also provided information on this in my previous response.
Regards,
KIRAN KALE.
From India, Kolhapur
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Yes, it is true that for those covered under u/s.1(4), the rate of contribution is 10%, as mentioned in the aforementioned point no. 24. I have also provided information on this in my previous response.
Regards,
KIRAN KALE.
From India, Kolhapur
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If any candidate is already working in an organization as a daily-rated employee through a service provider and is later observed by the same organization as a permanent employee, what happens to his balance leave with the service provider during that period for which he receives salary through the service provider?
Please help me.
Regards,
Kan Singh Ranawat
Project Accountant
From India, Shimla
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Please help me.
Regards,
Kan Singh Ranawat
Project Accountant
From India, Shimla
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sir if one person completes 58,but still working means ,how to calculate for challan payment...how to make basic in difference.please give some idea.
From India, Madras
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From India, Madras
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Dear Rajesh Kanna,
After completion of 58 years of age, the contribution of 8.33% towards the pension scheme stops, and that same contribution should be diverted to the employer's contribution. This means the employer's contribution should be at 12% where 3.67% is shown.
Regards,
KIRAN KALE
From India, Kolhapur
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After completion of 58 years of age, the contribution of 8.33% towards the pension scheme stops, and that same contribution should be diverted to the employer's contribution. This means the employer's contribution should be at 12% where 3.67% is shown.
Regards,
KIRAN KALE
From India, Kolhapur
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Hi Sir,
I am a fresher with no experience in PF and ESI. I have joined as an HR executive in a private firm where more than 20 employees are working. My manager is asking me to work on PF and ESI. There are no previous records for PF and ESI as we are going to start deducting PF for our employees for the upcoming year. I don't know how and where to start working on this.
Regards,
Rameela
From India, Chennai
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I am a fresher with no experience in PF and ESI. I have joined as an HR executive in a private firm where more than 20 employees are working. My manager is asking me to work on PF and ESI. There are no previous records for PF and ESI as we are going to start deducting PF for our employees for the upcoming year. I don't know how and where to start working on this.
Regards,
Rameela
From India, Chennai
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PF & ESI CALCULATION SHEET EXAMPLE.xls