Hello
While calculating EPS wages do we have to reduce Rs 6500 ceiling proportionate to LWP days even if the EPF earnings are already below Rs 6500?
Eg: Standard Basic+DA of an employee is Rs 10000. LWP for June 15 days. Earned Basic+DA is Rs 5000 which is also considered for EPF. Now, should we maintain Rs 5000 for EPS too or prorate Rs 6500 / 30 x 15 = 3250.
As far I understand, if the EPS wages is under 6500 then we have to take the same amount. But I am not aware of reducing the Rs 6500 ceiling proportionate to LWP days.
Experts please throw light on this.
regards
From India, Aurangabad
14While calculating EPS wages do we have to reduce Rs 6500 ceiling proportionate to LWP days even if the EPF earnings are already below Rs 6500?
Eg: Standard Basic+DA of an employee is Rs 10000. LWP for June 15 days. Earned Basic+DA is Rs 5000 which is also considered for EPF. Now, should we maintain Rs 5000 for EPS too or prorate Rs 6500 / 30 x 15 = 3250.
As far I understand, if the EPS wages is under 6500 then we have to take the same amount. But I am not aware of reducing the Rs 6500 ceiling proportionate to LWP days.
Experts please throw light on this.
regards
From India, Aurangabad
You can take either way. For pension fund the only requirement is that the amount should not be more than Rs 541, ie, 8.33% of 6500. If the gross salary is Rs 5000 and if you deduct Rs 600, then you can bifurcate your share of contribution as 417 towards Pension Fund and the balance Rs 183 towards Provident Fund. Alternatively, you can remit Rs 271 (8.33% of 3250) to Pension and the balance, 329 in Provident Fund. In both the case, the cost to company would be the same.
If you have the practice of restricting both PF and Pension fund to 6500 and reducing the PF qualifying salary proportionately by every Loss of Pay day, then you will have to hold the salary as 6500 and reduce it by the number of unpaid days. In such case the Pf will be deducted on Rs 3250 (in your example)
Both ways are being practiced. Only thing is that if you follow one system then it should be followed.
Regards,
Madhu.T.K
From India, Kannur
If you have the practice of restricting both PF and Pension fund to 6500 and reducing the PF qualifying salary proportionately by every Loss of Pay day, then you will have to hold the salary as 6500 and reduce it by the number of unpaid days. In such case the Pf will be deducted on Rs 3250 (in your example)
Both ways are being practiced. Only thing is that if you follow one system then it should be followed.
Regards,
Madhu.T.K
From India, Kannur
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