Q1. What is the difference between Other Allowance and Special Allowance?
Q2. Which should be correctively used?
Q3. What is the min and max amount of PF deduction in Rs. on a monthly basis from an individual?
Q4. Minimum wages component should include (Basic + DA + SA) what if company chooses no DA in salary structure?
Q5. How can we ensure compliance, minimum cost to employer along with maximum payout to employee?
From India, Mumbai
1Q2. Which should be correctively used?
Q3. What is the min and max amount of PF deduction in Rs. on a monthly basis from an individual?
Q4. Minimum wages component should include (Basic + DA + SA) what if company chooses no DA in salary structure?
Q5. How can we ensure compliance, minimum cost to employer along with maximum payout to employee?
From India, Mumbai
1. & 2. Other allowance is as the name is, special allowance may be treated for PF salary as in some states the term is used as DA. Instead of terming an allowance as other give it proper name, HRA, Conveyance allowance, CCA etc.
3. The legal contribution on PF salary is 12% for all. Employee can contribute higher than 12% contribution provided the employer agrees as he has to pay admin charges on total remittance.
4. As long as company pays applicable minimum wages, the components are not important. Splitting of minimum wages may turn out to be risky in future. It is better to deduct PF on wage component equivalent to minimum wages.
5. ESI cost can be reduced marginally if you include reasonable component of salary as Washing Allowance. WA does not attract ESI as long as it is say Rs. 250 or so per month. PF cost of new joinees will be nil if their basic component of CTC is more than Rs. 15,000 per month. When existing PF member's salary increases beyond Rs.15,000 pm, let employer share be only 12% of 15,000 i. e. Rs. 1800 pm
From India, Mumbai
3. The legal contribution on PF salary is 12% for all. Employee can contribute higher than 12% contribution provided the employer agrees as he has to pay admin charges on total remittance.
4. As long as company pays applicable minimum wages, the components are not important. Splitting of minimum wages may turn out to be risky in future. It is better to deduct PF on wage component equivalent to minimum wages.
5. ESI cost can be reduced marginally if you include reasonable component of salary as Washing Allowance. WA does not attract ESI as long as it is say Rs. 250 or so per month. PF cost of new joinees will be nil if their basic component of CTC is more than Rs. 15,000 per month. When existing PF member's salary increases beyond Rs.15,000 pm, let employer share be only 12% of 15,000 i. e. Rs. 1800 pm
From India, Mumbai
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E compliance.pdf
Statutory Compliance of a Industrial or Commercial Unit.xls