As per the EPF scheme, the wage limit upto which the emplopyer's contribution has to be paid is Rs.6500/- per month.
If a person's initital appointment is with a monthly wages of Rs.6501, is the employer liable to pay the EPF employer contribution ? As the wage exceeding the maximum limit specified.
In certain organization employer contribution @ 12% of the wages (basic + Da) is remitted. Here there is no restriction is made to the maximum wage limit of Rs.6500/-. In this case, is it statutorily obliged to pay the administrative charges for the whole wages.
If the wage limit for administrative charges is taken @ Rs.6500/- per employee for whose wages exceed Rs.6500/-, definitely there would be cost saving. Please advise is it possible to limit the wages @ Rs.6500/- for calculation of administrative charges.
SIVADASAN.A
From India, Kochi
If a person's initital appointment is with a monthly wages of Rs.6501, is the employer liable to pay the EPF employer contribution ? As the wage exceeding the maximum limit specified.
In certain organization employer contribution @ 12% of the wages (basic + Da) is remitted. Here there is no restriction is made to the maximum wage limit of Rs.6500/-. In this case, is it statutorily obliged to pay the administrative charges for the whole wages.
If the wage limit for administrative charges is taken @ Rs.6500/- per employee for whose wages exceed Rs.6500/-, definitely there would be cost saving. Please advise is it possible to limit the wages @ Rs.6500/- for calculation of administrative charges.
SIVADASAN.A
From India, Kochi
Hi SIVADASAN,
As per EPF Act, the maximum ceiling for contribution is 6500/- basic salary..
But one can remain a member or can be a member even if he cross the ceiling.. It is done with the concern of both employee as well as employer..
But in this case employer's contribution remain same on the above said ceiling amount i.e 6500/- basic only...
Regards,
Amit Seth.
From India, Ahmadabad
496As per EPF Act, the maximum ceiling for contribution is 6500/- basic salary..
But one can remain a member or can be a member even if he cross the ceiling.. It is done with the concern of both employee as well as employer..
But in this case employer's contribution remain same on the above said ceiling amount i.e 6500/- basic only...
Regards,
Amit Seth.
From India, Ahmadabad
Respected sir,
There is some more clarification required in the reply.
As per the EPF Act, the Administrative expenditure is remitted as a percentage of wages. ie., 1.1%.
By considering the following situation, please offer your valuable opinion.
Number of employees engaged in an organisaton = 750
Wages of employees considered for EPF is ranging from Rs.10,000 to
Rs.25,000.
Employer's contribution is paid irrespective of the statutory wage limit. ie., contribution is paid to the whole wages (basic +da) No limit for Rs.6500 is fixed.
In the above situation whether one can pay the administrative expenditure by considering the total wages as Rs.6500 *750 as the statutory wage limit for payment of employer contirution is Rs.6500 per month only.
My opinion is to take the statutory maximum of Rs.6500 per head as the wage for the calculation of Administrative expenditure. So the administrative expenditure to be paid is Rs. (6500*750)*1.1%
with regards.
Sivadasan
Trivandrum.
From India, Kochi
There is some more clarification required in the reply.
As per the EPF Act, the Administrative expenditure is remitted as a percentage of wages. ie., 1.1%.
By considering the following situation, please offer your valuable opinion.
Number of employees engaged in an organisaton = 750
Wages of employees considered for EPF is ranging from Rs.10,000 to
Rs.25,000.
Employer's contribution is paid irrespective of the statutory wage limit. ie., contribution is paid to the whole wages (basic +da) No limit for Rs.6500 is fixed.
In the above situation whether one can pay the administrative expenditure by considering the total wages as Rs.6500 *750 as the statutory wage limit for payment of employer contirution is Rs.6500 per month only.
My opinion is to take the statutory maximum of Rs.6500 per head as the wage for the calculation of Administrative expenditure. So the administrative expenditure to be paid is Rs. (6500*750)*1.1%
with regards.
Sivadasan
Trivandrum.
From India, Kochi
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