Hai all
I am working as an Executive HR in a Private company at Hyderabad. I have a doubt in PF. “Is there any possibility to get exemption/ non-coverage from PF Act to any employee?” Please tell me or mail me at
I hear that if any employee getting more than 6500/- salary (Basic + DA) can be exempted from the PF Act. (Not only from Pension Scheme), if it is correct please refer me.
Thank you,
Krishna Prasad
From India, Hyderabad
Acknowledge(0)
Amend(0)
1I am working as an Executive HR in a Private company at Hyderabad. I have a doubt in PF. “Is there any possibility to get exemption/ non-coverage from PF Act to any employee?” Please tell me or mail me at
I hear that if any employee getting more than 6500/- salary (Basic + DA) can be exempted from the PF Act. (Not only from Pension Scheme), if it is correct please refer me.
Thank you,
Krishna Prasad
From India, Hyderabad
Acknowledge(0)Amend(0)
Exemption from PF means exemption from the operation of various provisions of the Employees' Provident Fund and Misc. Provisions Act. As such, the company that provides better superannuation schemes to employees than what is provided under the EPF Act may receive an exemption from EPF and Pension Schemes.
An employee whose salary exceeds Rs 6,500 at the time of joining the company shall be excluded from PF coverage. That means if an employee joins an establishment covered by EPF and their salary (Basic + DA) exceeds Rs 6,500, they may be excluded, and no contribution needs to be remitted for them. It does not mean that an employee who is already a member will also be excluded once their salary becomes more than Rs 6,500.
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
An employee whose salary exceeds Rs 6,500 at the time of joining the company shall be excluded from PF coverage. That means if an employee joins an establishment covered by EPF and their salary (Basic + DA) exceeds Rs 6,500, they may be excluded, and no contribution needs to be remitted for them. It does not mean that an employee who is already a member will also be excluded once their salary becomes more than Rs 6,500.
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
Thanks Mr.Madhu so if any employee’s salary(Basic+Da) above 6500/- at the time of Joining he is excluded from PF coverage, then is there any form required for this exemption?
From India, Hyderabad
Acknowledge(0)Amend(0)
From India, Hyderabad
Acknowledge(0)Amend(0)
No declaration is required to be filled. However, please get Form 11 from the new employee, which declares that he has not been a member of EPF earlier. This declaration is for your file only and need not be sent to EPF.
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
For example, we are currently paying a flat rate of 3600 to our staff and covering PF contributions for that amount, considering it as the Basic Salary. No allowances are paid at this time. Now, we are looking to increase the salary to 3850. Is it possible to do so without incurring additional liability on PF?
From India, Palakkad
Acknowledge(0)Amend(0)
From India, Palakkad
Acknowledge(0)Amend(0)
Normally, HRA is excluded from the PF qualifying salary. However, if the basic salary on which PF is deducted and contributed is very low, then there is a chance of including HRA in the PF qualifying salary. This is because the PF authorities operate on a formula where the employer may be required to pay PF on at least the minimum wages set by the government. Therefore, ensure that you contribute PF on at least 70% of the total salary.
If your current PF qualifying salary is Rs 3600, you can maintain it, and the additional Rs 350 can be allocated in the form of other allowances such as HRA or Conveyance. It is advisable to avoid Special Allowance, as it may be subject to different interpretations by the PF authorities.
Special allowance may be perceived as dearness allowance, provided to offset the cost of living. On the other hand, HRA refers to house rent allowance, Conveyance Allowance covers commuting expenses to the office and back, and CCA represents city compensatory allowance. Unlike the aforementioned, special allowance does not directly correspond to any expenses incurred by the employee. Hence, there is a possibility of it being considered as part of the salary and dearness allowance.
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
If your current PF qualifying salary is Rs 3600, you can maintain it, and the additional Rs 350 can be allocated in the form of other allowances such as HRA or Conveyance. It is advisable to avoid Special Allowance, as it may be subject to different interpretations by the PF authorities.
Special allowance may be perceived as dearness allowance, provided to offset the cost of living. On the other hand, HRA refers to house rent allowance, Conveyance Allowance covers commuting expenses to the office and back, and CCA represents city compensatory allowance. Unlike the aforementioned, special allowance does not directly correspond to any expenses incurred by the employee. Hence, there is a possibility of it being considered as part of the salary and dearness allowance.
Regards,
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.