Hi.. This is swetha.. I am presently associated with Construction company.Can anyone please let me know the calculation of Pf and ESI. As some companies are deducting PF from Basic salary of Gross Salary but some companies are deducting Pf from basic salary of net salary i.e after deducting LOPs (If any) from gross.. Which one is right and also give me clarity with calculation...
From India, Hyderabad
1From India, Hyderabad
Hi Ms. Swetha
Both ESI & EPF is calculated on the earned gross/basic wages only
ESI is calculated on the earned gross salary on the particular month
EPF is calculated on the earned Wages & other retaining allowances on the particular month
ESI & EPF are not been contributed for loss of pay due to absenteeism
If any doubt you can reach me
From India, Bangalore
Both ESI & EPF is calculated on the earned gross/basic wages only
ESI is calculated on the earned gross salary on the particular month
EPF is calculated on the earned Wages & other retaining allowances on the particular month
ESI & EPF are not been contributed for loss of pay due to absenteeism
If any doubt you can reach me
From India, Bangalore
Dear Swetha
Simple rule: PF is on Basic + DA earned in that particular months.
ESIC is on Gross Salary earned in that particular month
Bonus is 8.33% on (Basic + DA) earned in that particular Month.
Gratuity is 4.17% on (Basic + DA) earned in that particular Month (It will be paid at the time of F & F settlement for those who worked for more than 5 Years).
Regards
Karthik
From India, Hyderabad
Simple rule: PF is on Basic + DA earned in that particular months.
ESIC is on Gross Salary earned in that particular month
Bonus is 8.33% on (Basic + DA) earned in that particular Month.
Gratuity is 4.17% on (Basic + DA) earned in that particular Month (It will be paid at the time of F & F settlement for those who worked for more than 5 Years).
Regards
Karthik
From India, Hyderabad
If payable salary is Rs 12000/Pm and he has loss of pay for 5 days then the salary he earned during the month will be Rs 10000.So deduction of Epf will be Rs 1200 .Deduction for ESI will be 1.75% of wages earned on all components of wages after lop deduction.
From India, Thiruvananthapuram
From India, Thiruvananthapuram
Dear Ms. Sweta,
I would like to inform you that the correct deduction of ESIC and PF and salary components should be cover as per the rule and Act is Most important.
1. ESIC will be deduct on Gross salary of Employee who getting <15000/ per month , and over time will be also add in monthly gross.
Employee share will 1.75% and Employees share will 4.75% both will be deduct on same salary, and please also keep remember if after decimal contribution value 0.01 will come kindly consider 1 rupee.
2. PF will be deduct on BASIC + DA as per the rule 12% of Employee contribution. employees contribution will be as per the rule 13.36% ( including account no 10,2,21 & 22). EPF should be 8.33% of 15000 (Limit) maximum. as per the New notification 500 should be remit in Account no 2 and 200 in account no 22.
For More clarification please call us or write us .
enquiry@adroitservice.com, 9599342841.
Regards,
Adroit Manpower & Compliance Service.
From India, Delhi
I would like to inform you that the correct deduction of ESIC and PF and salary components should be cover as per the rule and Act is Most important.
1. ESIC will be deduct on Gross salary of Employee who getting <15000/ per month , and over time will be also add in monthly gross.
Employee share will 1.75% and Employees share will 4.75% both will be deduct on same salary, and please also keep remember if after decimal contribution value 0.01 will come kindly consider 1 rupee.
2. PF will be deduct on BASIC + DA as per the rule 12% of Employee contribution. employees contribution will be as per the rule 13.36% ( including account no 10,2,21 & 22). EPF should be 8.33% of 15000 (Limit) maximum. as per the New notification 500 should be remit in Account no 2 and 200 in account no 22.
For More clarification please call us or write us .
enquiry@adroitservice.com, 9599342841.
Regards,
Adroit Manpower & Compliance Service.
From India, Delhi
Dear Ms. Sweta,
I would like to inform you that the correct deduction of ESIC and PF and salary components should be cover as per the rule and Act is Most important.
1. ESIC will be deduct on Gross salary of Employee who getting <15000/ per month , and over time will be also add in monthly gross.
Employee share will 1.75% and Employer share will 4.75% both will be deduct on same salary, and please also keep remember if after decimal contribution value 0.01 will come kindly consider 1 rupee.
2. PF will be deduct on BASIC + DA as per the rule 12% of Employee contribution. employer contribution will be as per the rule 13.36% ( including account no 10,2,21 & 22). EPF should be 8.33% of 15000 (Limit) maximum. as per the New notification 500 should be remit in Account no 2 and 200 in account no 22.
For More clarification please call us or write us .
, 9599342841.
Regards,
Adroit Manpower & Compliance Service.
From India, Delhi
I would like to inform you that the correct deduction of ESIC and PF and salary components should be cover as per the rule and Act is Most important.
1. ESIC will be deduct on Gross salary of Employee who getting <15000/ per month , and over time will be also add in monthly gross.
Employee share will 1.75% and Employer share will 4.75% both will be deduct on same salary, and please also keep remember if after decimal contribution value 0.01 will come kindly consider 1 rupee.
2. PF will be deduct on BASIC + DA as per the rule 12% of Employee contribution. employer contribution will be as per the rule 13.36% ( including account no 10,2,21 & 22). EPF should be 8.33% of 15000 (Limit) maximum. as per the New notification 500 should be remit in Account no 2 and 200 in account no 22.
For More clarification please call us or write us .
Regards,
Adroit Manpower & Compliance Service.
From India, Delhi
As per latest EPFO circular dated 18/03/14, EPF wage on which EPF contribution needs to be deducted is Basic(excluding HRA, overtime,bonus, commission etc) + DA+ Food concession+retaining allowance.
From India, Thane
From India, Thane
dear Shweta,
just to add to the above, do not follow general definition of wages for PF given above. please use the two tests below as given by the Supreme court:
The Supreme Court has laid down two tests to determine whether a component is included in the definition of ‘basic wages’ or not. These are ‘test of universality’ and ‘test of contingency’.
Applying the test of universality, if a component is paid universally, necessarily and ordinarily to all employees of a company, the same is included in the definition of basic wages. Applying the test of contingency, if a component is paid subject to uncertain events like overtime payment, the same is excluded from the definition of basic wages.
So, if you are paying any cash component universally, necessarily and ordinarily to all, like any allowance is being paid to all employees, that needs to be construed as wages. so overtime, bonuses, etc are not part of PF wages, but any other component needs to be run through the test of "Universally, necessarily and ordinarily paid."
From India, Mumbai
just to add to the above, do not follow general definition of wages for PF given above. please use the two tests below as given by the Supreme court:
The Supreme Court has laid down two tests to determine whether a component is included in the definition of ‘basic wages’ or not. These are ‘test of universality’ and ‘test of contingency’.
Applying the test of universality, if a component is paid universally, necessarily and ordinarily to all employees of a company, the same is included in the definition of basic wages. Applying the test of contingency, if a component is paid subject to uncertain events like overtime payment, the same is excluded from the definition of basic wages.
So, if you are paying any cash component universally, necessarily and ordinarily to all, like any allowance is being paid to all employees, that needs to be construed as wages. so overtime, bonuses, etc are not part of PF wages, but any other component needs to be run through the test of "Universally, necessarily and ordinarily paid."
From India, Mumbai
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Salary Sheet & PF PT Calculation & Challan Nov 2010.xls