Dear All,
I am working in Software MNC in Chennai, but our PF contribution state is at Maharashtra (Pune).
In our organization, the PF contribution is Rs.780 per month by Employee and Rs.780 per month by Employer irrespective of employee’s basic salary. The PF contribution is fixed Rs.780 for all employees irrespective of their basic pay.
But from the Employer’s contribution Rs. 541 per Month is going to Employer Pension and Rs.239 is contributed to PF.
Whenever any employee resigns and claims the PF, they get the amount based on the Rs.1,019 (780+239) only.
So, what about the Rs,541 contributed towards Employer Pension? How, when and where to get this money?
Please let me know, whether the above PF contribution is correct as per PF act.
Best Regards,
Ramprasad Raju
From India, Chennai
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I am working in Software MNC in Chennai, but our PF contribution state is at Maharashtra (Pune).
In our organization, the PF contribution is Rs.780 per month by Employee and Rs.780 per month by Employer irrespective of employee’s basic salary. The PF contribution is fixed Rs.780 for all employees irrespective of their basic pay.
But from the Employer’s contribution Rs. 541 per Month is going to Employer Pension and Rs.239 is contributed to PF.
Whenever any employee resigns and claims the PF, they get the amount based on the Rs.1,019 (780+239) only.
So, what about the Rs,541 contributed towards Employer Pension? How, when and where to get this money?
Please let me know, whether the above PF contribution is correct as per PF act.
Best Regards,
Ramprasad Raju
From India, Chennai
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Dear Mr. Raju,
The monthly contribution submitted to EPFO can be distributed in three parts: EE Share, ER PF Share, and ER PN Share (which you have mentioned as 780, 239, and 541).
When an employee leaves the employment of the organization, he or she has to fill out the EPF Forms according to his or her eligibility. Form-19 is used to withdraw the EE Share and ER PF Share (as mentioned based on 780+239). Generally, your subordinates fill out this form after leaving the job.
For the ER PN Share, Form 10C/10D is submitted as per the applicability.
If an employee has been an EPF Member for less than 6 months, they are not eligible to withdraw this Share. However, if their membership tenure is more than 6 months but less than 9 years and 6 months, then they can fill out Form-10C to withdraw this share. Similarly, if the service tenure is more than 9 years and 6 months, then Form-10D is filled out, and this share becomes a monthly pension credited to the member's pension account as per the act, on a monthly basis after reaching the age of 50/58 years.
I hope this clarifies your doubts. Cheers.
From India, Delhi
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167The monthly contribution submitted to EPFO can be distributed in three parts: EE Share, ER PF Share, and ER PN Share (which you have mentioned as 780, 239, and 541).
When an employee leaves the employment of the organization, he or she has to fill out the EPF Forms according to his or her eligibility. Form-19 is used to withdraw the EE Share and ER PF Share (as mentioned based on 780+239). Generally, your subordinates fill out this form after leaving the job.
For the ER PN Share, Form 10C/10D is submitted as per the applicability.
If an employee has been an EPF Member for less than 6 months, they are not eligible to withdraw this Share. However, if their membership tenure is more than 6 months but less than 9 years and 6 months, then they can fill out Form-10C to withdraw this share. Similarly, if the service tenure is more than 9 years and 6 months, then Form-10D is filled out, and this share becomes a monthly pension credited to the member's pension account as per the act, on a monthly basis after reaching the age of 50/58 years.
I hope this clarifies your doubts. Cheers.
From India, Delhi
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Dear Mr. Bhuwan,
I understand the process to get the EPF contribution now. Thank you very much for the immediate response and clarification.
I would like to inquire whether the fixed Rs. 780 PM contribution is correct as per the act. Many people mention a 12% contribution towards PF based on basic pay. However, our company contributes a fixed Rs. 780 for each employee, regardless of their basic pay. Is there an exceptional law governing this?
I have also learned from other sources that ER PN is 8.33% of the employer's contribution. Why is our company deducting Rs. 541 for the same, when the ER contribution should be Rs. 780 only?
Please address my concerns to assist some of my worried colleagues. Thank you.
Best Regards,
Ramprasad Raju
From India, Chennai
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I understand the process to get the EPF contribution now. Thank you very much for the immediate response and clarification.
I would like to inquire whether the fixed Rs. 780 PM contribution is correct as per the act. Many people mention a 12% contribution towards PF based on basic pay. However, our company contributes a fixed Rs. 780 for each employee, regardless of their basic pay. Is there an exceptional law governing this?
I have also learned from other sources that ER PN is 8.33% of the employer's contribution. Why is our company deducting Rs. 541 for the same, when the ER contribution should be Rs. 780 only?
Please address my concerns to assist some of my worried colleagues. Thank you.
Best Regards,
Ramprasad Raju
From India, Chennai
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Dear all respected seniors,
I have one doubt regarding the PF issue, i.e., I want to know whether PF should be calculated on gross or Basic plus DA. If possible, could anybody provide the latest proof stating the amendment where the government has changed the rule that PF has to be calculated on gross and not from Basic + DA?
I kindly request clarification and guidance at the earliest convenience.
Regards,
Raj
Executive
From India, Madras
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I have one doubt regarding the PF issue, i.e., I want to know whether PF should be calculated on gross or Basic plus DA. If possible, could anybody provide the latest proof stating the amendment where the government has changed the rule that PF has to be calculated on gross and not from Basic + DA?
I kindly request clarification and guidance at the earliest convenience.
Regards,
Raj
Executive
From India, Madras
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Dear Mr. Raju and Mr. Raj,
The EPF and EPS contributions are always calculated based on Basic + DA, as mentioned in the EPF Act. I recommend reviewing the EPF Act and any relevant amendments for clarification.
The contribution is typically calculated at a rate of 12% on Basic + DA or Rs. 6,500 (the most recent ceiling amount), whichever is lower. This limit is known as the wages ceiling for EPF, and there are current discussions to revise it to Rs. 15,000.
I hope this clarifies any doubts you may have.
Thank you.
From India, Delhi
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The EPF and EPS contributions are always calculated based on Basic + DA, as mentioned in the EPF Act. I recommend reviewing the EPF Act and any relevant amendments for clarification.
The contribution is typically calculated at a rate of 12% on Basic + DA or Rs. 6,500 (the most recent ceiling amount), whichever is lower. This limit is known as the wages ceiling for EPF, and there are current discussions to revise it to Rs. 15,000.
I hope this clarifies any doubts you may have.
Thank you.
From India, Delhi
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Dear Mr. Bhuwan,
Thank you for the clarifications. Now it is clear to me that the way my organization is contributing a fixed amount of Rs. 780 for all employees, irrespective of their Basic+DA, may not be the right approach for EPF contribution.
Best Regards,
Ramprasad Raju
From India, Chennai
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Thank you for the clarifications. Now it is clear to me that the way my organization is contributing a fixed amount of Rs. 780 for all employees, irrespective of their Basic+DA, may not be the right approach for EPF contribution.
Best Regards,
Ramprasad Raju
From India, Chennai
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Hi All,
Need a bit of help. I moved from one company to another & on request to transfer the PF from Old organisation to New via online process the claim got rejected. Reasoning provided was “EPS contribution was wrongly deducted by the previous employer(Teamlease) so that they needed to submit a clarification letter from your previous employer(Teamlease) on letterhead.”
While requesting the letter from old company they responded to provide a clarification letter format which I am unable to find. If anyone can help here.
From India, Gurgaon
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Need a bit of help. I moved from one company to another & on request to transfer the PF from Old organisation to New via online process the claim got rejected. Reasoning provided was “EPS contribution was wrongly deducted by the previous employer(Teamlease) so that they needed to submit a clarification letter from your previous employer(Teamlease) on letterhead.”
While requesting the letter from old company they responded to provide a clarification letter format which I am unable to find. If anyone can help here.
From India, Gurgaon
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There may be many reasons for the wrong deduction of EPS contribution. From September 2014, there was a circular from EPFO stating that for newly joined employees, if the PF gross is more than 15,000/- per month, the entire amount will be deposited to PF instead of EPS. It may be the wrong percentage of EPS deduction. You have not mentioned anything about your past employment status - organizations, date of joining in each organization, date of leaving in each organization, any settlements made with EPFO and when, and if there were any gaps between any two employments.
Once you identify the real reason, it will be a simple matter of drafting a letter stating the actual reason, and hopefully, the problem will be solved.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531
USD HR Solutions – To strive towards excellence with effort and integrity
From India, New Delhi
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Once you identify the real reason, it will be a simple matter of drafting a letter stating the actual reason, and hopefully, the problem will be solved.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531
From India, New Delhi
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Calcu. pf Emp.eps.epf sample sheet for HR site..xls
EPF,EPS,EDLI.pp t