Dear Sir,
Let me suggest on the below example of calculation:
Basic is 10000/-
EXP: 1)
A) EMPLOYEE = 12% = 1200/-
B) EMPLOYER = 8.33% TOWARD PENSION ON 6500/- BASIC = 541/-
AND TOWARDS PF = (1200-541) = 659 /-
THUS TOTAL OF EMPLOYER = 541+659 = 1200/-
EXP: 2)
A) EMPLOYEE = 12% = 1200/-
B) EMPLOYER = 8.33% TOWARD PENSION ON 6500/- BASIC = 541/-
AND TOWARDS PF 3.67% ON 6500 = 239 /-
THUS TOTAL OF EMPLOYER = 541+239 = 780/-
Which example is correct?
From,
RAJU SHRINAME
From India, Chicalim
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5Let me suggest on the below example of calculation:
Basic is 10000/-
EXP: 1)
A) EMPLOYEE = 12% = 1200/-
B) EMPLOYER = 8.33% TOWARD PENSION ON 6500/- BASIC = 541/-
AND TOWARDS PF = (1200-541) = 659 /-
THUS TOTAL OF EMPLOYER = 541+659 = 1200/-
EXP: 2)
A) EMPLOYEE = 12% = 1200/-
B) EMPLOYER = 8.33% TOWARD PENSION ON 6500/- BASIC = 541/-
AND TOWARDS PF 3.67% ON 6500 = 239 /-
THUS TOTAL OF EMPLOYER = 541+239 = 780/-
Which example is correct?
From,
RAJU SHRINAME
From India, Chicalim
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Dear Raju,
Example 1 is correct. The employee's contribution is 12%, regardless of the basic salary he is earning. According to the PF Act, the employer must contribute 8.33% or 541 (whichever is lower) towards the Pension fund, and the remaining amount goes to the PF account. This means that the employer's contribution is equal to the employee's contribution. In addition to these contributions, the employer is also responsible for bearing the administrative charges as per the PF Act.
From India, Gurgaon
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Example 1 is correct. The employee's contribution is 12%, regardless of the basic salary he is earning. According to the PF Act, the employer must contribute 8.33% or 541 (whichever is lower) towards the Pension fund, and the remaining amount goes to the PF account. This means that the employer's contribution is equal to the employee's contribution. In addition to these contributions, the employer is also responsible for bearing the administrative charges as per the PF Act.
From India, Gurgaon
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Ex-2 is correct, the difference between employer and employee contribution i.e(Rs1200 -Rs.780 = Rs420) is treated as volantory contribution on the employee.
From India, Hubli
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From India, Hubli
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Hi,
Please note that it is not compulsory for the employer to contribute 12% of the basic salary equal to the employee's share if the Basic is more than Rs. 6500/-. The employer can contribute only up to the limit of Rs. 6500/-.
Out of this amount, 8.33% of the employer's contribution goes towards the Pension Scheme, while the remaining percentage will go towards the PF.
In your example, the employee will contribute Rs. 1200/- towards their PF deduction, and the employer will contribute only Rs. 780/-.
Thank you.
From India, Chennai
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Please note that it is not compulsory for the employer to contribute 12% of the basic salary equal to the employee's share if the Basic is more than Rs. 6500/-. The employer can contribute only up to the limit of Rs. 6500/-.
Out of this amount, 8.33% of the employer's contribution goes towards the Pension Scheme, while the remaining percentage will go towards the PF.
In your example, the employee will contribute Rs. 1200/- towards their PF deduction, and the employer will contribute only Rs. 780/-.
Thank you.
From India, Chennai
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If Basic is more than Rs. 6500/- employee may contribute 12% on basic or 780/-. but Employer can contribute only for the limitation amount of 780/- (12% on Rs. 6500/-) regards M Srinivasa Rao
From India, Hyderabad
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From India, Hyderabad
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Dear Sir,
I have a doubt regarding PF. If an employee's basic is 25,000/-, if he is interested in increasing his PF amount, up to how much percentage can he increase it? On which basis can he increase it - on the current basic amount or on 6,500/-?
From India, Bangalore
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I have a doubt regarding PF. If an employee's basic is 25,000/-, if he is interested in increasing his PF amount, up to how much percentage can he increase it? On which basis can he increase it - on the current basic amount or on 6,500/-?
From India, Bangalore
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Hi, it's not a must for an employee to fix the ceiling. He can contribute the whole basic (i.e., 10000) or 6500, and he can even make a voluntary contribution (i.e., 12% + 12%) from his side. But it's a must for the employer to pay his contribution on the ceiling amount (i.e., 6500) along with the admin charges. It's not mandatory to contribute on the whole basic pay if the basic is more than 6500. This is what the PF Act says.
And even we can exempt those employers as higher salary people under the instructions from the regional PF office.
From India, Coimbatore
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And even we can exempt those employers as higher salary people under the instructions from the regional PF office.
From India, Coimbatore
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Dear Mr. Santosh,
Please be informed that employees can contribute up to the limitation of 88% of basic (apart from the statutory contribution of 12%), but it is subject to the conditions stated under the Payment of Wages Act. As per the PoW Act, the overall deductions should not be more than 50% of Gross Salary.
From India, Chennai
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Please be informed that employees can contribute up to the limitation of 88% of basic (apart from the statutory contribution of 12%), but it is subject to the conditions stated under the Payment of Wages Act. As per the PoW Act, the overall deductions should not be more than 50% of Gross Salary.
From India, Chennai
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Hi, the file which I've uploaded is taken from this discussion forum. I don't remember who uploaded it. Now, I couldn't able to find this file. So please explain to me what is that PF wages? Is that the employee's Basic + DA? And moreover, what is VPF? Please make me clear...
From India, Coimbatore
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From India, Coimbatore
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