Dear Kindly consider Prof Tax of Rs.175/- per month for deduction. Also check the policy of Daily allowance. Kindly study the labour laws deeply.
From United States, Toledo
From United States, Toledo
Dear Zareen, Sorry for disturb you again.... I want to know how did u calculate employee PF 720 & employer ESIC 640. Plz explain in detail.........
From India, Jaipur
5From India, Jaipur
Dear
I am giving below two tables showing
1) Pay pocket
2) CTC (Cost to the company)
Any company while recruiting an incumbent, will tell the cost to the company and the candidate has to check with them the Gross pay.
1) Salary in Pay Pocket
Basic 2500
HRA 1450
Edn Allowance 400
Spl. Allowance 3050
Conv. Allowance 800
CCA 250
Med. Allowance 1250
Total Gross 9700
Deduction from Salary
PF @ 12% on Basic only 300
Net pay to the Employee 9400
(Gross - deduction)
2) CTC (Cost to the Company)
Basic 2500
HRA 1450
Edn Allowance 400
Spl. Allowance 3050
Conv.Allowance 800
CCA 250
Med. Allowance 1250
Total Gross 9700
PF Management contribution 300
CTC total 10000
By looking both the tables you can understand there is no mistake in the deduction of PF from the salary. PF deducted from Basic in this case is correct. Please keep in mind his salary is Rs.9700/ only (Basic 2500 + Allowances 7200) & NOT 10000/-
Just for your information, Rs. 300 rupees deducted from his salary will go to his PF account and another Rs.300 (equal amount) paid by the management as Management contribution will go to his Pension account.
In his PF account his contribution alone will get accumulated with interest and management contribution will NOT be added to his account.
V. Selvaraj
Senior Executive (HR)
From India, Bangalore
I am giving below two tables showing
1) Pay pocket
2) CTC (Cost to the company)
Any company while recruiting an incumbent, will tell the cost to the company and the candidate has to check with them the Gross pay.
1) Salary in Pay Pocket
Basic 2500
HRA 1450
Edn Allowance 400
Spl. Allowance 3050
Conv. Allowance 800
CCA 250
Med. Allowance 1250
Total Gross 9700
Deduction from Salary
PF @ 12% on Basic only 300
Net pay to the Employee 9400
(Gross - deduction)
2) CTC (Cost to the Company)
Basic 2500
HRA 1450
Edn Allowance 400
Spl. Allowance 3050
Conv.Allowance 800
CCA 250
Med. Allowance 1250
Total Gross 9700
PF Management contribution 300
CTC total 10000
By looking both the tables you can understand there is no mistake in the deduction of PF from the salary. PF deducted from Basic in this case is correct. Please keep in mind his salary is Rs.9700/ only (Basic 2500 + Allowances 7200) & NOT 10000/-
Just for your information, Rs. 300 rupees deducted from his salary will go to his PF account and another Rs.300 (equal amount) paid by the management as Management contribution will go to his Pension account.
In his PF account his contribution alone will get accumulated with interest and management contribution will NOT be added to his account.
V. Selvaraj
Senior Executive (HR)
From India, Bangalore
Hi Rani,
There is a correction in the PF Calculation
Please find the calculations:
PF is calculated on Basic *(i.e Basic + DA)
*Note : this might differ in Salary Structure of Company to Company
Employer's contribution [13.61% = 12% + *1.61% (PF Admin Charges)]of Basic Salary
[Though 1.61 % does not include in Employee Cost to Company]
Employer's PF Contribution here :
Basic = 2500+1450 = 3950
Contribution = 12% of 3950 = Rs.474
ESIC CONTRIBUTION
ESIC is calculated on Monthly Salary Rs. 9700
Employer's ESIC Contribution - [4.75% of Monthly in hand Salary]
Contribution = 4.75% of 9700 = Rs.640
As per my knowledge, there is no Professional Tax applicable for Delhi state.
Hope the Clarification required is resolved, Would appreciate valuable inputs if there is any misunderstanding or any correction is required
From India, Gurgaon
There is a correction in the PF Calculation
Please find the calculations:
PF is calculated on Basic *(i.e Basic + DA)
*Note : this might differ in Salary Structure of Company to Company
Employer's contribution [13.61% = 12% + *1.61% (PF Admin Charges)]of Basic Salary
[Though 1.61 % does not include in Employee Cost to Company]
Employer's PF Contribution here :
Basic = 2500+1450 = 3950
Contribution = 12% of 3950 = Rs.474
ESIC CONTRIBUTION
ESIC is calculated on Monthly Salary Rs. 9700
Employer's ESIC Contribution - [4.75% of Monthly in hand Salary]
Contribution = 4.75% of 9700 = Rs.640
As per my knowledge, there is no Professional Tax applicable for Delhi state.
Hope the Clarification required is resolved, Would appreciate valuable inputs if there is any misunderstanding or any correction is required
From India, Gurgaon
Dear, it is completly right because pf deduction is done only in basis and PF amount is deducting from Total A. Best Regards, lakhan Trivedi 0967481106
From India, Khopoli
From India, Khopoli
Thanks everyone for your reply......... Now Im able to understand the difference & I will tell him about these deductions............... THANKS BANDNA RANI
From India, Jaipur
From India, Jaipur
Ms. Bandana Rani,
From India, Pune
- Going by the facts given by you, there is nothing wrong in a calculations and payment of your friends salary.
- 12% of basic is employee's contribution, same amount is contributed by employer and it is paid to PF authorities. Obviously employees contribution is deducted from salary but employer will not keep it with him, but will pay to PF authorities.
- If in case you are not a HR Professional, your doubt is understandable. But in case you are HR Professional, better buckle-up and update your basic knowledge.
From India, Pune
Hi,
Please let us know if your friends gross salary is Rs. 9700 or Rs. 10,000. If your friends gross is Rs. 10,000 then according to the salary break up his basic salary is Rs. 2500 so Rs. 300 such be deducted from his salary for PF and he gets Rs. 9700 in hand.
In the other case if your friend gross salary is Rs. 9700 then according to the salary break up his basic salary is Rs. 2500 so Rs. 300 such be deducted from his salary for PF and he gets Rs. 9400 in hand.
Hope its clear to you.
- Babu
From India, Madras
Please let us know if your friends gross salary is Rs. 9700 or Rs. 10,000. If your friends gross is Rs. 10,000 then according to the salary break up his basic salary is Rs. 2500 so Rs. 300 such be deducted from his salary for PF and he gets Rs. 9700 in hand.
In the other case if your friend gross salary is Rs. 9700 then according to the salary break up his basic salary is Rs. 2500 so Rs. 300 such be deducted from his salary for PF and he gets Rs. 9400 in hand.
Hope its clear to you.
- Babu
From India, Madras
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