First of all, YES, the establishment will be liable for a penalty under EPF. If you are wondering why? It is because it is mandatory for the establishment to be registered under the EPF Act when it has a staff of more than 20 employees.
EPF challan cannot be submitted online. (for
)
Now the solution: Register under EPF as soon as possible.
This part must not be followed: Show that the establishment has more than 20 employees for the last 2 or 3 months before registration. This way, your liability for a penalty (Section 14B & 7Q) will be reduced.
Now the hard part (still not recommending it): you have to prepare balance sheets and other documents to show the above. (if the inspection is being carried out by EPF officials)
Important: The penalty would be 100% (i.e., the amount deposited by the employer through challans for the last periods), and the interest would be equal to the amount announced by the EPF office yearly (say 9.5% for the last year).
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Atom
From India, Phagwara
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19EPF challan cannot be submitted online. (for
Now the solution: Register under EPF as soon as possible.
This part must not be followed: Show that the establishment has more than 20 employees for the last 2 or 3 months before registration. This way, your liability for a penalty (Section 14B & 7Q) will be reduced.
Now the hard part (still not recommending it): you have to prepare balance sheets and other documents to show the above. (if the inspection is being carried out by EPF officials)
Important: The penalty would be 100% (i.e., the amount deposited by the employer through challans for the last periods), and the interest would be equal to the amount announced by the EPF office yearly (say 9.5% for the last year).
Stay Cool
Atom
From India, Phagwara
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Dear Shenbagarajan,
Thank you very much. Actually, we are paying a net salary of Rs. 4000 without considering any allowances. My doubt is, if we take Rs. 3000 as the basic salary, then how should we split the remaining Rs. 1000 as allowances? Kindly suggest to me what allowances can be taken into account. Our BPO is in a rural area.
With Regards,
Thangaraj.P
From India, Tuticorin
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Thank you very much. Actually, we are paying a net salary of Rs. 4000 without considering any allowances. My doubt is, if we take Rs. 3000 as the basic salary, then how should we split the remaining Rs. 1000 as allowances? Kindly suggest to me what allowances can be taken into account. Our BPO is in a rural area.
With Regards,
Thangaraj.P
From India, Tuticorin
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Dear Thangaraj,
Which state do you belong to?
Even though it is rural, the minimum wage is applicable for all. If you are giving more than the minimum wage, you can go ahead with the following heads:
Basic + DA - 3000
HRA - 600
TA - 200
Medical allowance - 200
Else:
Basic + DA (As per minimum wages)
HRA (20 - 40% of basic)
TA (Transport allowance of Rs. 800 - maximum)
From India, Mumbai
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Which state do you belong to?
Even though it is rural, the minimum wage is applicable for all. If you are giving more than the minimum wage, you can go ahead with the following heads:
Basic + DA - 3000
HRA - 600
TA - 200
Medical allowance - 200
Else:
Basic + DA (As per minimum wages)
HRA (20 - 40% of basic)
TA (Transport allowance of Rs. 800 - maximum)
From India, Mumbai
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