Dear Seniors,
Kindly furnish me with the appropriate answer to my query as mentioned below:
As we know, the PF ceiling limit is going to be enhanced from September 2014 onwards to Rs. 15,000; previously, it was Rs. 6,500.
Previously, if any employee had a basic salary of more than Rs. 6,500 per month, it was optional for them to choose PF deduction or not (let's assume that in this case, the employee's monthly drawn salary is Rs. 12,000).
Gross = Rs. 12,000
Basic (60%) = Rs. 7,200
So, he can be exempted from PF deduction if the company wishes, it can provide the PF facility over Rs. 6,500 (Rs. 780 per month).
My query is, from September 2014 onwards, according to the new rule, all employees who are drawing less than Rs. 15,000 per month will be liable to have PF deduction on a monthly basis on the overall basic salary amount.
Thus, all employees will require new registration for EPF from September 2014 who were not enrolled in EPF in the past due to the old ceiling limit of Rs. 6,500.
Will it create any problems for the employer?
Kindly provide your valuable suggestions at the earliest. I am looking for an appropriate reply.
Thanks,
Neetu Bisht
neetubisht9@gmail.com
From India, New Delhi
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8Kindly furnish me with the appropriate answer to my query as mentioned below:
As we know, the PF ceiling limit is going to be enhanced from September 2014 onwards to Rs. 15,000; previously, it was Rs. 6,500.
Previously, if any employee had a basic salary of more than Rs. 6,500 per month, it was optional for them to choose PF deduction or not (let's assume that in this case, the employee's monthly drawn salary is Rs. 12,000).
Gross = Rs. 12,000
Basic (60%) = Rs. 7,200
So, he can be exempted from PF deduction if the company wishes, it can provide the PF facility over Rs. 6,500 (Rs. 780 per month).
My query is, from September 2014 onwards, according to the new rule, all employees who are drawing less than Rs. 15,000 per month will be liable to have PF deduction on a monthly basis on the overall basic salary amount.
Thus, all employees will require new registration for EPF from September 2014 who were not enrolled in EPF in the past due to the old ceiling limit of Rs. 6,500.
Will it create any problems for the employer?
Kindly provide your valuable suggestions at the earliest. I am looking for an appropriate reply.
Thanks,
Neetu Bisht
neetubisht9@gmail.com
From India, New Delhi
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Hi,
1. Yes, employees and employers need to contribute the amount up to 15,000. Above 15,000, employees have the option to join.
2. In this case, the employer can limit their contribution to 15,000.
3. The employer will not face any problems; just identify the employees over 6,500 and enroll them starting from the 1st of September.
4. The ECR generation process remains the same as before.
From India, Mumbai
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1. Yes, employees and employers need to contribute the amount up to 15,000. Above 15,000, employees have the option to join.
2. In this case, the employer can limit their contribution to 15,000.
3. The employer will not face any problems; just identify the employees over 6,500 and enroll them starting from the 1st of September.
4. The ECR generation process remains the same as before.
From India, Mumbai
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Dear All,
In addition to the discussion, I have attached my understanding with three scenarios for the period before the ceiling increase and after the increase.
Please confirm whether I am correct in my understanding.
Regards,
Arul Prakash D.
From India, Madras
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In addition to the discussion, I have attached my understanding with three scenarios for the period before the ceiling increase and after the increase.
Please confirm whether I am correct in my understanding.
Regards,
Arul Prakash D.
From India, Madras
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Hi Arul,
For those employees who are new to PF and have a basic salary exceeding Rs. 15,000, the EPS (8.33%) should not be given but should be added to EPF. However, for existing employees, EPS can be given even if the basic salary is more than Rs. 15,000, but 1.16% of the amount is to be given to the Central Govt. The best approach would be to restrict EPS to Rs. 15,000 and calculate Rs. 1250.
This is my understanding.
Thanks,
Mahesh.H.M.M
From India, Bangalore
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For those employees who are new to PF and have a basic salary exceeding Rs. 15,000, the EPS (8.33%) should not be given but should be added to EPF. However, for existing employees, EPS can be given even if the basic salary is more than Rs. 15,000, but 1.16% of the amount is to be given to the Central Govt. The best approach would be to restrict EPS to Rs. 15,000 and calculate Rs. 1250.
This is my understanding.
Thanks,
Mahesh.H.M.M
From India, Bangalore
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[QUOTE=neetubisht9@gmail.com;2175574]
Dear Seniors,
Kindly furnish me with an appropriate answer for my query as mentioned below:
As we know, the PF ceiling limit is going to be enhanced from September 2014 onwards to 15000; previously, it was 6500.
Previously, if an employee had a basic salary of more than 6500 per month, then it was optional for them to choose PF deduction or not. Let's assume that in this case, the employee's monthly drawn salary is 12000.
Gross = Rs. 12000
Basic (60%) = 7200
So, he can be exempted from PF Deduction. If the company wishes, it can provide the PF facility over 6500 (780 per month).
My query is that now from September 2014 onwards, according to the new rule, all employees who are drawing less than 15000 pm will be liable to have PF Deduction on a monthly basis on the overall basic amount.
Thus, all employees will require new registration for EPF from September 2014, who were not enrolled in EPF in the past due to the old ceiling limit of 6500?
Will it create any problem for the employer?
Kindly provide your valuable suggestions at the earliest. Looking for an appropriate reply.
Thanks,
Neetu Bisht
Hi Neetu,
I have understood as follows:
1. Those employees whose basic is less than Rs. 15000 should get enrolled in PF (if they had not enrolled before since their basic was more than Rs. 6500).
2. Employees new to PF (that means not new to the company) and basic is more than Rs. 15000, EPS should not be contributed but to be added to EPF. In other words, they will not be eligible to get a pension. They have to find out different options like NPS, etc.
Thanks,
Mahesh.H.M.M
From India, Bangalore
Acknowledge(0)Amend(0)
Dear Seniors,
Kindly furnish me with an appropriate answer for my query as mentioned below:
As we know, the PF ceiling limit is going to be enhanced from September 2014 onwards to 15000; previously, it was 6500.
Previously, if an employee had a basic salary of more than 6500 per month, then it was optional for them to choose PF deduction or not. Let's assume that in this case, the employee's monthly drawn salary is 12000.
Gross = Rs. 12000
Basic (60%) = 7200
So, he can be exempted from PF Deduction. If the company wishes, it can provide the PF facility over 6500 (780 per month).
My query is that now from September 2014 onwards, according to the new rule, all employees who are drawing less than 15000 pm will be liable to have PF Deduction on a monthly basis on the overall basic amount.
Thus, all employees will require new registration for EPF from September 2014, who were not enrolled in EPF in the past due to the old ceiling limit of 6500?
Will it create any problem for the employer?
Kindly provide your valuable suggestions at the earliest. Looking for an appropriate reply.
Thanks,
Neetu Bisht
Hi Neetu,
I have understood as follows:
1. Those employees whose basic is less than Rs. 15000 should get enrolled in PF (if they had not enrolled before since their basic was more than Rs. 6500).
2. Employees new to PF (that means not new to the company) and basic is more than Rs. 15000, EPS should not be contributed but to be added to EPF. In other words, they will not be eligible to get a pension. They have to find out different options like NPS, etc.
Thanks,
Mahesh.H.M.M
From India, Bangalore
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1.EPS limit in A/c-10 restricted to 1000/- only, remaining amount will be credit in EPF A/c, Same as earlier.
From India, Mumbai
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From India, Mumbai
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Hi Aditya,
I think your perception of Rs. 1000/- (minimum amount) is wrong. In that case, employees whose basic is Rs. 8000/- or less, the EPF amount becomes negative.
I checked with the PF department. They said the minimum pension payable by them to the dependents is Rs. 1000/-. If EPS is more, the pension amount will also be more.
Thanks,
Mahesh. H. M. M.
From India, Bangalore
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I think your perception of Rs. 1000/- (minimum amount) is wrong. In that case, employees whose basic is Rs. 8000/- or less, the EPF amount becomes negative.
I checked with the PF department. They said the minimum pension payable by them to the dependents is Rs. 1000/-. If EPS is more, the pension amount will also be more.
Thanks,
Mahesh. H. M. M.
From India, Bangalore
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Hi, Dear Mahesh,
1. Can you tell me the earlier EPS A/c-10 limit, i.e., 541?
2. In the same case, I mentioned that it may be restricted to 1000/- for A/c 10. Lower amounts will also be calculated as in the earlier process (8000*8.33%).
You may be right that 1000 may be the limit of pension for dependents, but I have not confirmed it yet.
From India, Mumbai
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1. Can you tell me the earlier EPS A/c-10 limit, i.e., 541?
2. In the same case, I mentioned that it may be restricted to 1000/- for A/c 10. Lower amounts will also be calculated as in the earlier process (8000*8.33%).
You may be right that 1000 may be the limit of pension for dependents, but I have not confirmed it yet.
From India, Mumbai
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Dear Aditya,
Before, we were limiting EPS to Rs. 541/- (not paying more than that). Now, it will be Rs. 1250/-. If you pay more than Rs. 1250/- towards EPS, then 1.16% of salaries is to be paid to the Central Govt (the procedure of payment is not clear to me yet).
Thanks,
Mahesh.H.M.M
From India, Bangalore
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Before, we were limiting EPS to Rs. 541/- (not paying more than that). Now, it will be Rs. 1250/-. If you pay more than Rs. 1250/- towards EPS, then 1.16% of salaries is to be paid to the Central Govt (the procedure of payment is not clear to me yet).
Thanks,
Mahesh.H.M.M
From India, Bangalore
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EPF ON LINE REGN. USER MANUAL.pdf