Hi All
Amal Shere is Very True
its the right and correct answer of the query given by Mr. Amal Shere.
either deduct on 6500.00 as per act or on increases basic if employer agree to pay equally contribution on increased basic.
as for as pension is concerned you may restict the contribution Rs. 541.00 (i.e. 8.33% of 6500) and balance from the employer share goes to PF. account of employee.
further Pension may also be contributed on increased salary more than 6500.00 in the act there is no restriction to contibute towards the pension only up to 6500.00. Actually once one opt for basic limit 6500.00 then afterward on increase in basic he can not go for pension on increased basic.
e.g. if initial basic of an employee 6000.00 then pension share will be Rs. 500.00 and on increase if basic become Rs. 8000.00, then there is option for pension contribution either opt for limit 6500.00 i.e. 541.00 or on increased basic 8000.00 i.e. 8.33% of 8000.00 = 666.00
Normally establishment opt the pension scheme upto the basic Rs. 6500.00 and contribute Rs. 541.00 only and for P.F. contribute on more than 6500.00, But there is no provision in the Act to limit your contribution only upto 541.00 for pension scheme.
Hope it will clarify the whole idea of P.F. & Pension under the Employees Provident Fund & Misc. Provisions Act. 1952.
for more information you can write.
Thanks
Mohd. Arif Khan
13Amal Shere is Very True
its the right and correct answer of the query given by Mr. Amal Shere.
either deduct on 6500.00 as per act or on increases basic if employer agree to pay equally contribution on increased basic.
as for as pension is concerned you may restict the contribution Rs. 541.00 (i.e. 8.33% of 6500) and balance from the employer share goes to PF. account of employee.
further Pension may also be contributed on increased salary more than 6500.00 in the act there is no restriction to contibute towards the pension only up to 6500.00. Actually once one opt for basic limit 6500.00 then afterward on increase in basic he can not go for pension on increased basic.
e.g. if initial basic of an employee 6000.00 then pension share will be Rs. 500.00 and on increase if basic become Rs. 8000.00, then there is option for pension contribution either opt for limit 6500.00 i.e. 541.00 or on increased basic 8000.00 i.e. 8.33% of 8000.00 = 666.00
Normally establishment opt the pension scheme upto the basic Rs. 6500.00 and contribute Rs. 541.00 only and for P.F. contribute on more than 6500.00, But there is no provision in the Act to limit your contribution only upto 541.00 for pension scheme.
Hope it will clarify the whole idea of P.F. & Pension under the Employees Provident Fund & Misc. Provisions Act. 1952.
for more information you can write.
Thanks
Mohd. Arif Khan
Dear friends,
As per the comments, this is not a problem at all.
All the employees will come under PF till they are going to be in the service. It will be always good for the employer if you restrict all the employees into PF. if the employees feels that they dont want to come under PF, Maintain separate attendance for them and receive a letter stating that they themselves prepared for non-deduction of PF and also approved by the management.
if the employee crosses the basic amount of Rs. 6500/-. have a standard deduction of Rs. 780/-. This is one of statutory rule in EPF. Follow this standard rule for all the employees whoever crosses the basic >=6500.
You will be safe in this case.
if you deduct 12% for Rs. 8000/-, it will be Rs. 960/- a huge deduction for employees also from employer point of view, the management has to pay more. (Which some employees dont like to except a huge deduction eventhough it is a saving).
Thanks and Regards,
Manimegalai
From India, Madras
As per the comments, this is not a problem at all.
All the employees will come under PF till they are going to be in the service. It will be always good for the employer if you restrict all the employees into PF. if the employees feels that they dont want to come under PF, Maintain separate attendance for them and receive a letter stating that they themselves prepared for non-deduction of PF and also approved by the management.
if the employee crosses the basic amount of Rs. 6500/-. have a standard deduction of Rs. 780/-. This is one of statutory rule in EPF. Follow this standard rule for all the employees whoever crosses the basic >=6500.
You will be safe in this case.
if you deduct 12% for Rs. 8000/-, it will be Rs. 960/- a huge deduction for employees also from employer point of view, the management has to pay more. (Which some employees dont like to except a huge deduction eventhough it is a saving).
Thanks and Regards,
Manimegalai
From India, Madras
HI,
The thresshold limit for PF exemption is only for those who are freshers. It does not debar people with higher basic but offers them a one time option to joining PF. once he joins, he remains a memeber Even if his basic increases beyond the prescribed limit, he remains covered under EPF.
Further, since this person in question alreday enrolled as PF member, he continues to remain PF memebr irresepctive his Basic salary, which is expeced to increase every year.
Trust, this clarifies,
Regards,
Sateesh Chandra
From India, Bangalore
The thresshold limit for PF exemption is only for those who are freshers. It does not debar people with higher basic but offers them a one time option to joining PF. once he joins, he remains a memeber Even if his basic increases beyond the prescribed limit, he remains covered under EPF.
Further, since this person in question alreday enrolled as PF member, he continues to remain PF memebr irresepctive his Basic salary, which is expeced to increase every year.
Trust, this clarifies,
Regards,
Sateesh Chandra
From India, Bangalore
Dear firends
i dont why yoiu confusing yourself.
Please suggest your answer bearing the act in your minds. See actually the basic was Rs.6000 and it is increased to Rs.8000/- The basic statutorily allowable by PF is Rs.6500/-
There are only four options left behind
Option1: PF Deduction - from employee on 6500/- and employer on 6500
option 2: PF deduction- from employee on 8000/- and employer on 8000/-
option3: PF Deduction-from employee on 8000 and employer on 6500/-
Option4: The employee can submit a letter to PF authorites thro his/her
employer that he is not preferring to contribute towards PF since
he has crossed 6500/-limit.
any contracdictions let us have a forum on this
Thanks and regards
Michael Nicholas
From India, Madras
i dont why yoiu confusing yourself.
Please suggest your answer bearing the act in your minds. See actually the basic was Rs.6000 and it is increased to Rs.8000/- The basic statutorily allowable by PF is Rs.6500/-
There are only four options left behind
Option1: PF Deduction - from employee on 6500/- and employer on 6500
option 2: PF deduction- from employee on 8000/- and employer on 8000/-
option3: PF Deduction-from employee on 8000 and employer on 6500/-
Option4: The employee can submit a letter to PF authorites thro his/her
employer that he is not preferring to contribute towards PF since
he has crossed 6500/-limit.
any contracdictions let us have a forum on this
Thanks and regards
Michael Nicholas
From India, Madras
Dear Mr. Abinav, once an employee crosses Rs.6500/- he has an option either to continue or to obstain from pf contribution. regards Michael Nicholas
From India, Madras
From India, Madras
Hi !
After reading so many answers to your questions i think Mr. Amal Shere is absolutly right and i also share the same view on this, in P.F. if you once cover ur employee and then you rais the basic salary he has to give his contribution that is 12 % on 6500/- only if you want to give hi P.F. contribution on more than 6500/- then you have to take permission from your management as the also have to contribute their contribution on the same amount and contribution towards will be on 6500/- only as that is pension scheme.
Regards
Abhinav
From India, Delhi
After reading so many answers to your questions i think Mr. Amal Shere is absolutly right and i also share the same view on this, in P.F. if you once cover ur employee and then you rais the basic salary he has to give his contribution that is 12 % on 6500/- only if you want to give hi P.F. contribution on more than 6500/- then you have to take permission from your management as the also have to contribute their contribution on the same amount and contribution towards will be on 6500/- only as that is pension scheme.
Regards
Abhinav
From India, Delhi
HI!
Actually he will be covered until he left the organisation, or change one, once the P. F. number is issued he is coverable by P.F., an employee is not covered when he is hired on above 6500/- salary.
Regards
Abhinav
From India, Delhi
Actually he will be covered until he left the organisation, or change one, once the P. F. number is issued he is coverable by P.F., an employee is not covered when he is hired on above 6500/- salary.
Regards
Abhinav
From India, Delhi
Dear Friends,
Here is the clarification of PF Contribution;
Clarification about Contribution
After revision in wage ceiling from Rs.5000 to Rs.6500 w.e.f. 1.6.2001 per month, the government will continue to contribute 1.16% up to the actual wage of maximum Rs.6500 per month towards Employees’ Pension Scheme. The employer’s share in the Pension Scheme will be Rs.541 w.e.f. 1.6.2001.
Under Employees’ Deposit-Linked Insurance Scheme the contribution @ 0.50% is required to be paid up to a maximum limit of Rs.6500.
The employer also will pay administrative charges @ 0.01% on maximum limit of Rs.6500 whereas an exempted establishment will pay inspection charges @ 0.005% on the total wages paid.
Notes:
The above clarification is given by taking wages up to a maximum of Rs.6500 towards wage (basic+DA).
Since an excluded employee i.e. drawing wages more than Rs.6500 can also become member of the Fund and the Schemes on joint request and if, for instance, such an employee is getting Rs.10,000 per month, his share towards provident fund contribution will be Rs.1200 e.g. 12% and employer’s share towards provident fund contribution will be Rs.659 and Rs.541 towards Employees’ Pension Fund.
Regards,
PBS KUMAR
From India, Kakinada
Here is the clarification of PF Contribution;
Clarification about Contribution
After revision in wage ceiling from Rs.5000 to Rs.6500 w.e.f. 1.6.2001 per month, the government will continue to contribute 1.16% up to the actual wage of maximum Rs.6500 per month towards Employees’ Pension Scheme. The employer’s share in the Pension Scheme will be Rs.541 w.e.f. 1.6.2001.
Under Employees’ Deposit-Linked Insurance Scheme the contribution @ 0.50% is required to be paid up to a maximum limit of Rs.6500.
The employer also will pay administrative charges @ 0.01% on maximum limit of Rs.6500 whereas an exempted establishment will pay inspection charges @ 0.005% on the total wages paid.
Notes:
The above clarification is given by taking wages up to a maximum of Rs.6500 towards wage (basic+DA).
Since an excluded employee i.e. drawing wages more than Rs.6500 can also become member of the Fund and the Schemes on joint request and if, for instance, such an employee is getting Rs.10,000 per month, his share towards provident fund contribution will be Rs.1200 e.g. 12% and employer’s share towards provident fund contribution will be Rs.659 and Rs.541 towards Employees’ Pension Fund.
Regards,
PBS KUMAR
From India, Kakinada
It is not necessary to deduct pf if salary crosses the limit of Rs.6500/- it totally depend upon employee wish, actually whenever basic is above rs.6500/- employer needs to get the permission form pf office then only he can deduct the pf amount but actually rule is not followed.
so it is not necessary to deduct pf amount.
From India, Ahmadabad
so it is not necessary to deduct pf amount.
From India, Ahmadabad
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HC All - Trainees not covered for PF -2010.pdf
PF Ledger.xls