Understanding PF Rules and Deductions
I would like to know the PF rules in detail. As we all know, the PF thresholds were revised from 1st September 2014. My query is, in my organization, most of my employees have a basic salary of more than Rs. 15,000/-, but their PF deduction amount is a flat Rs. 1,800 per month (12% of Rs. 15,000). Is it mandatory that an employee with a basic salary of more than Rs. 15,000 is limited to Rs. 1,800 as a deduction? Is this deduction of Rs. 1,800 correct as per the law? Is it not possible to deduct 12% directly on the actual basic as per the law? What does the law exactly say?
I have searched a lot on Google and asked a few consultants, but I have not received a satisfactory reply. I hope this discussion thread will help me get my answer.
Appreciate your response and suggestions on the same.
Thanks,
Triveni
From India, Thana
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1I would like to know the PF rules in detail. As we all know, the PF thresholds were revised from 1st September 2014. My query is, in my organization, most of my employees have a basic salary of more than Rs. 15,000/-, but their PF deduction amount is a flat Rs. 1,800 per month (12% of Rs. 15,000). Is it mandatory that an employee with a basic salary of more than Rs. 15,000 is limited to Rs. 1,800 as a deduction? Is this deduction of Rs. 1,800 correct as per the law? Is it not possible to deduct 12% directly on the actual basic as per the law? What does the law exactly say?
I have searched a lot on Google and asked a few consultants, but I have not received a satisfactory reply. I hope this discussion thread will help me get my answer.
Appreciate your response and suggestions on the same.
Thanks,
Triveni
From India, Thana
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Hello Parab,
I am sure all your queries would get resolved if you go through the thread on PF available on this website. What you are asking is something that many people have asked time and again. The answers given by the fraternity members are quite detailed and precise. Check it out.
Cheers,
A.B.
From India, Mumbai
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I am sure all your queries would get resolved if you go through the thread on PF available on this website. What you are asking is something that many people have asked time and again. The answers given by the fraternity members are quite detailed and precise. Check it out.
Cheers,
A.B.
From India, Mumbai
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Dear Triveni,
For an EPF member with a salary of more than Rs. 15,000, the statutory contribution to PF is Rs. 1,800. If the employee and employer wish, the contribution may be based on the actual salary, which is not statutory but optional.
I hope this answer clears up any queries you may have.
Abbas P.S
From India, Bangalore
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For an EPF member with a salary of more than Rs. 15,000, the statutory contribution to PF is Rs. 1,800. If the employee and employer wish, the contribution may be based on the actual salary, which is not statutory but optional.
I hope this answer clears up any queries you may have.
Abbas P.S
From India, Bangalore
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EPF-Circular-da ted-23-May-2011 -Splitting-of-M inimum-Wages-fo r-the-Purpose-o f-PF-Contributi on-Not.pdf
Salary Sheet & PF PT Calculation & Challan Nov 2010.xls