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Dear Seniors,

Kindly suggest to me on the below-mentioned issue. I'm deducting PF on basic 6500 as per the government ceiling. If the basic is higher than 6500, can I mention the same basic and deduct PF for 6500 only, i.e., 780, irrespective of the actual basic amount? For example, if the basic is 10000 but PF is deducted for 6500, i.e., 780. In this case, can I mention in the payslip the basic amount as 10000 and PF as 780? If not, how should I split the salary? Please advise.

From India, Hyderabad
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Hi , in pay slip you need to mention the actual basic what ever is the amount. and 780 you can show as deduction towards PF . Where is the issue . Regards Rajeev Dixit
From India, Bangalore
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Hi, you can show the PF deduction 780/- irrespective your actual basic, you can show the actual basic, pf deduction 780/-
From India, Hyderabad
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Thanks, Rajeev & Ashok.

I have another query, i.e., should I mention any note in the payslip or CTC breakup sheet that I'm deducting PF based on the government ceiling of 6500? Employees have been asking what they should mention about the PF deduction percentage if they move to other companies.

From India, Hyderabad
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No need to mention like that, you can say the same things when you have small meetings, while observing the employees.
From India, Hyderabad
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No its not required to mention that way . You can convey this orally when asked . Regards Rajeev Dixit
From India, Bangalore
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Dear Ashok, Is there any problem if i mention note below CTC as well as Pay slip that PF is calculated on Basic of 6500. Regards Ramya
From India, Hyderabad
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Dear Ashok & Rajeev,

Thank you for your reply. The employees are not satisfied with oral communication; they want the information in written format. They believe that showing the payslip in written form will make it more credible to other companies. Are there any legal issues related to mentioning or not mentioning this information?

From India, Hyderabad
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u can mention in appointment letter, is there any problem to disclose the same thing orally not through Pay slip.
From India, Hyderabad
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From India, Bangalore
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Hi, Ask them to check appointment letter at last page of Salary Break up, if is not there give mail on the same to employees so that then can understand the statutory requirements.
From India, Hyderabad
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Hi,

PF deduction is restricted only to the employer's contribution of Rs. 650/- (i.e., Rs. 780/-). Why do you want to restrict the employees' deduction? You can deduct PF on the total value of Basic & DA.

Regards, Mubarack Senior Manager - HR

From India, Madras
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I agree with what Kumar says. As per the EPF Act, the maximum salary ceiling for the deduction of PF is 6500. Additionally, there is a clause that allows the member to contribute on their entire basic salary if they choose to do so, and the employer may restrict the contribution to the ceiling of 6500.
From India, Delhi
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From India, Bangalore
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DEAR ramyachary YOU CAN ADD ONE COLUM IN PAYSLIP MENTIONING PF BASIC AS RS.6500/-JUST BELOW ACTUAL BASIC WHICH WILL SOLVE YOUR PROBLEM REGARDS NILESH SONI 9869477332
From India, Mumbai
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Dear Sir, If the basic is higher than 6500, you can mention the actual basic (i.e., 10000) & for PF contribution, you can show Rs. 780/- In the payslip, you can also mention Rs. 10000/- as basic. If the employee wants any clarification, you can explain that the employer need not contribute more than 6500 (upper ceiling limit). Nowadays, I heard that for PF contribution, except HRA, they will include all the allowances.
From India, Tiruchchirappalli
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Dear Sir,

If the basic is higher than 6500, you can mention the actual basic (i.e., 10000) & for PF contribution, you can show Rs.780/-. In the payslip, you can also mention Rs.10000/- as basic. If the employee wants any clarification, you can explain that the employer need not contribute more than 6500 (upper ceiling limit).

Nowadays, I heard that for PF contribution, except HRA, they will include all the allowances.

R. Dhamodhara Kannan

From India, Tiruchchirappalli
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Dear Ramyachary,

After PF deduction of Rs. 780, any additional contribution should be calculated for a member with a basic salary of more than Rs. 6,500. The remaining amount will go into the Pension account.

Santosh M.

From India, Mumbai
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Dear Santosh M,

Your statement is totally wrong. Please note that pension contribution is a company's part, and there are no deductions from the salary for pension contribution. It is a fixed 8.33% of basic + DA, with a maximum of Rs 541/-. So, please update your knowledge and do not post wrong information.

Nilesh Soni
9869477332

From India, Mumbai
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Dear Member,

It is not that big a problem for which you have sought clarification. You can simply show your gross pay in one column and in another column, you can mention as 'PF wages', which can be restricted to the prescribed limit of Rs. 6500/- on which you can deduct the PF contribution.

BS Kalsi
Contributing Member

From India, Mumbai
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Dear Nilesh,

Thank you for your valuable information. I made an error in mentioning "pension" instead of the Employer's PF contribution. I understand that the pension percentage is fixed at 8.33%, and any amount exceeding that, such as Rs. 541/-, is added to the employer's PF contribution.

For example, if the basic amount is Rs. 8000/-, the Employee's PF contribution would be Rs. 960/-, and the employer's PF contribution would be Rs. 419 plus the pension amount of Rs. 541/- (419 + 541 = 960).

I trust this clarification clears up any confusion.

Regards,
Santosh M.

From India, Mumbai
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