Dear All,
Please suggest if the company provides an option to have PF deducted or not, what is the better choice. Since my basic pay is above 25,000 per month (which is above 6,500 per month), I have an option here. Please provide suggestions with reasons on why I should or should not have PF deducted.
Thanks
From India, Delhi
Acknowledge(0)
Amend(0)
38Please suggest if the company provides an option to have PF deducted or not, what is the better choice. Since my basic pay is above 25,000 per month (which is above 6,500 per month), I have an option here. Please provide suggestions with reasons on why I should or should not have PF deducted.
Thanks
From India, Delhi
Acknowledge(0)Amend(0)
Hello Kanika, Every one has to deduct the PF * To save tax * To avail Pension benefits * To Avail EDLI benefits * To earn interest Regards, Ashish
From India, Pune
Acknowledge(0)Amend(0)
From India, Pune
Acknowledge(0)Amend(0)
Hello Kanika,
Provident fund is a component that is useful for every individual who is an employee and associated with any organization. It depends on the employer/organization whether they have the policy of deduction for PF contribution. Also, you must be aware if they have generated the respective PF account number against the deduction made on behalf of the employee.
I would suggest you go ahead with PF, which will act as one of the savings along with the opportunity to get tax rebate if you fall in the tax bracket.
Regards,
Jeevan
From India, Thiruvananthapuram
Acknowledge(0)Amend(0)
Provident fund is a component that is useful for every individual who is an employee and associated with any organization. It depends on the employer/organization whether they have the policy of deduction for PF contribution. Also, you must be aware if they have generated the respective PF account number against the deduction made on behalf of the employee.
I would suggest you go ahead with PF, which will act as one of the savings along with the opportunity to get tax rebate if you fall in the tax bracket.
Regards,
Jeevan
From India, Thiruvananthapuram
Acknowledge(0)Amend(0)
In my view, becoming a member of EPF on a higher salary is also beneficial for many reasons such as compulsory saving, receiving a higher interest rate than market rates, becoming eligible for a pension after 10 years of service, enjoying the benefits of insurance without any contribution, and securing family pension in case of death, etc. Moreover, one can also retrieve their money along with interest upon leaving the job. The present computerized system in EPFO is simplifying and expediting the procedures.
Chandok AK
RPFC (Retd.)
www.akchandok.com
From India, Chandigarh
Acknowledge(0)Amend(0)
Chandok AK
RPFC (Retd.)
www.akchandok.com
From India, Chandigarh
Acknowledge(0)Amend(0)
It is always beneficial to subscribe to P.F. even if you are not within the purview of the Act. Apart from the benefits of providing you a lump sum amount to tide over the hardship of sudden loss of income on retirement, it can provide you with regular pension after retirement to secure your future as well as entitle you to insurance benefits.
It is very difficult to save from the salary in the modern lifestyle where the temptation for spending is irresistible with a new model with more attractive features surfacing in the market every day, either in mobiles, TVs, garments, goggles, or cars, not to speak of the race to compete with colleagues or neighbors to own these material possessions. Therefore there needs to be a forced saving. The P.F. option provides that. This apart, you can get exemption from income tax on the P.F. contribution as well as on the lump-sum amount payable on retirement which you would be paying otherwise since savings will be meager for a salary of Rs.25,000/- p.m. given the cost of accommodation, children's education in good schools, conveyance, medical care, and the daily food basket.
Hope this helps.
B. Saikumar
In-House HR & IR Advisor
From India, Mumbai
Acknowledge(0)Amend(0)
It is very difficult to save from the salary in the modern lifestyle where the temptation for spending is irresistible with a new model with more attractive features surfacing in the market every day, either in mobiles, TVs, garments, goggles, or cars, not to speak of the race to compete with colleagues or neighbors to own these material possessions. Therefore there needs to be a forced saving. The P.F. option provides that. This apart, you can get exemption from income tax on the P.F. contribution as well as on the lump-sum amount payable on retirement which you would be paying otherwise since savings will be meager for a salary of Rs.25,000/- p.m. given the cost of accommodation, children's education in good schools, conveyance, medical care, and the daily food basket.
Hope this helps.
B. Saikumar
In-House HR & IR Advisor
From India, Mumbai
Acknowledge(0)Amend(0)
Hi Kanika Ji,
PF deduction is better for you because the employer has to contribute an extra amount to your PF account, which may be calculated based on the ceiling limit, i.e., Rs. 6,500/-. Additionally, the interest received on PF is exempted from income tax.
So, in my perception, the deduction of PF will be beneficial for you.
Please let me know if you need further clarification or assistance.
Thank you.
From India, Dehra Dun
Acknowledge(0)Amend(0)
PF deduction is better for you because the employer has to contribute an extra amount to your PF account, which may be calculated based on the ceiling limit, i.e., Rs. 6,500/-. Additionally, the interest received on PF is exempted from income tax.
So, in my perception, the deduction of PF will be beneficial for you.
Please let me know if you need further clarification or assistance.
Thank you.
From India, Dehra Dun
Acknowledge(0)Amend(0)
Dear Kanika,
Learned friends have provided you with appropriate suggestions and advice. You might need a little more detailed account of PF, which is in the attached notes. Please use them to your advantage.
All the best.
From India, Bangalore
Acknowledge(0)Amend(0)
Learned friends have provided you with appropriate suggestions and advice. You might need a little more detailed account of PF, which is in the attached notes. Please use them to your advantage.
All the best.
From India, Bangalore
Acknowledge(0)Amend(0)
Its an optional option for an individual having basic more than 6500 cap, if employee is not an old subscriber. in case of old subscriber they he /she has to deduct despite of basic caps.
From India, New Delhi
Acknowledge(0)Amend(0)
From India, New Delhi
Acknowledge(0)Amend(0)
[Its an optional option for an individual having basic more than 6500 cap, if employee is not an old subscriber. in case of old subscriber they he /she has to deduct despite of basic caps.
From India, New Delhi
Acknowledge(0)Amend(0)
From India, New Delhi
Acknowledge(0)Amend(0)
Dear Kanika,
Our learned members, especially Mr. Kumar, have provided a very detailed explanation of the features of the EPF & MP Act. I would like to add further that even your VPF contributions will yield attractive, nontaxable returns in the range of 8.5% to 9.5%. In the normal course, if you consider an individual in a tax bracket of 30%, the returns would amount to 12% to 14%, which in the present scenario, is unimaginable. Unless you become a member of EPF, you cannot contribute to VPF and avail of this hidden benefit.
Hence, in short, opt for EPF and build a substantial corpus through VPF contributions with the highest returns.
Regards.
From India, Mumbai
Acknowledge(0)Amend(0)
Our learned members, especially Mr. Kumar, have provided a very detailed explanation of the features of the EPF & MP Act. I would like to add further that even your VPF contributions will yield attractive, nontaxable returns in the range of 8.5% to 9.5%. In the normal course, if you consider an individual in a tax bracket of 30%, the returns would amount to 12% to 14%, which in the present scenario, is unimaginable. Unless you become a member of EPF, you cannot contribute to VPF and avail of this hidden benefit.
Hence, in short, opt for EPF and build a substantial corpus through VPF contributions with the highest returns.
Regards.
From India, Mumbai
Acknowledge(0)Amend(0)Engage with peers to discuss and resolve work and business challenges collaboratively - share and document your knowledge. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Join & Be Part Of Our Community.
SALARY with out PF Deduction.xls
PF deduction on leave encashment.doc