Hello Everyone, I was reading the EPF Act 1952, and in Section 2, it defines "basic wages" as all the earnings that an employee receives while working, on leave, or during holidays with pay according to their employment contract. These earnings are provided in cash. However, basic wages do not include:
The monetary value of any food discounts.
Any dearness allowance (money paid to employees to counter inflation), house rent allowance, overtime pay, bonuses, commissions, or similar payments related to their employment or work performed.
I'm a bit confused by the statement "similar payments related to employment" at the end. How does one determine what other allowances fall under this category?
From India, Mumbai
The monetary value of any food discounts.
Any dearness allowance (money paid to employees to counter inflation), house rent allowance, overtime pay, bonuses, commissions, or similar payments related to their employment or work performed.
I'm a bit confused by the statement "similar payments related to employment" at the end. How does one determine what other allowances fall under this category?
From India, Mumbai
As per the Act Basic & DA is treated as EPF wages
Honourable supreme court in the month of Feb 2019 has given judgement on the definition of basic which includes on all the allowances such as Special Allowance, Travel/Conveyance Allowance, Medical Allowance, Other allowances which is naturally, commonly & regularly paid to all the employees. Post that even EPF department has notified the circular.
Since then in general all contributions excluding HRA is treated as EPF wages
From India, Bangalore
639Honourable supreme court in the month of Feb 2019 has given judgement on the definition of basic which includes on all the allowances such as Special Allowance, Travel/Conveyance Allowance, Medical Allowance, Other allowances which is naturally, commonly & regularly paid to all the employees. Post that even EPF department has notified the circular.
Since then in general all contributions excluding HRA is treated as EPF wages
From India, Bangalore
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Circular No 1-2018 Processing of income-tax returns under section 143(1) of the Income-tax Act .pdf
EPF Act.ppt