Hi Sir/ Madam,
For a person who is earning the basic salary of 18K the PF deduction is 720 ( may be max cab set by firm or Government ) but where as gratuity deduction is 900+, why there is no max cab set ?
Can someone help me with the calculation as there is more gratuity deduction compare to PF deduction...
Can\'t this Gratuity is calculated on the basis of 6.5K basic as may be they are calculation the PF
From United States, Cambridge
For a person who is earning the basic salary of 18K the PF deduction is 720 ( may be max cab set by firm or Government ) but where as gratuity deduction is 900+, why there is no max cab set ?
Can someone help me with the calculation as there is more gratuity deduction compare to PF deduction...
Can\'t this Gratuity is calculated on the basis of 6.5K basic as may be they are calculation the PF
From United States, Cambridge
Dear Shashank
Unlike the P.F Act, the Gratuity Act does not envisage any deduction from the salry of the employee and there is no wage limit for being eligible for gratuity under the Act.
B.Saikumar
HR & Labour Law Advisor
Mumbai
09930532927
From India, Mumbai
54Unlike the P.F Act, the Gratuity Act does not envisage any deduction from the salry of the employee and there is no wage limit for being eligible for gratuity under the Act.
B.Saikumar
HR & Labour Law Advisor
Mumbai
09930532927
From India, Mumbai
1. The maximum contribution to EPF in compliance with the ceiling salary of Rs. 6500 is Rs.780, not 720.
2. No contribution from employee side is required for Gratuity. As per Payment of Gratuity Act, the ceiling amount of Gratuity is Rs. 10,00,000, which is exempted from Income Tax also. If employer wish he may pay in addition to the above 10,00,000 which is liable to pay income tax.
Abbas.P.S
From India, Bangalore
2. No contribution from employee side is required for Gratuity. As per Payment of Gratuity Act, the ceiling amount of Gratuity is Rs. 10,00,000, which is exempted from Income Tax also. If employer wish he may pay in addition to the above 10,00,000 which is liable to pay income tax.
Abbas.P.S
From India, Bangalore
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