Hi Can any one suggest how to calculate P.F. contribution of Employee & Employer. if Basic Salary is 85000 per month.
From India, undefined
From India, undefined
Hi SNT, If the Basic Salary is 85000 Then , PF Employee Contribution = 85000*12% = 10200 PF Employee Contribution = 85000*13% = 11050 Regards Niharika
From India, Hyderabad
2From India, Hyderabad
There are two kinds of employers. One set of employers considers PF as an employee benefit. The second set of employers considers it as a statutory obligation. The former being employee friendly will deduct 12% o the entire Salary/ Basic salary and contribute the same amount to EPF and Pension fund. The second set of employers will deduct 12% of Rs 15000 and contribute the same only. Again there may be yet another kind of employer, who will deduct the employees' share on the actual basic salary, ie, Rs 85000 in your case but will contribute his share, ie, employer's share only on Rs 15000.
The benefits:
1. The employee contributing on full basic salary, ie, Rs 85000 will get a very god investment which will give a reasonably good interest (which no other bank can provide you in the current scenario)
2. If the employer is also contributing his share on actual salary, ie, Rs 85000, the employee MAY get the benefit of higher pension based on that higher amount of PF qualifying salary when he retires at the age of 58. If the review bench strikes down the verdict of Supreme Court (and of course the High Court of Kerala) which directs the EPFO to pay pension based on actual PF qualifying salary and restricts pension on Rs 15000, then the employer's share on difference amount will be credited to the employees PF. This can be withdrawn by the employee along with his own share of contributions.
3. The employer restricting the PF contribution to 12% of Rs 15000. The employee gets more take home salary. But for an employee whose basic salary is Rs 85000, this is nothing.
4. The employer who allows the employees to contribute on higher salary than Rs 15000, will favour the employee by tax benefits under 80CC. To that extend the employer is employee friendly.
Hope the above clarifies the matter.
From India, Kannur
The benefits:
1. The employee contributing on full basic salary, ie, Rs 85000 will get a very god investment which will give a reasonably good interest (which no other bank can provide you in the current scenario)
2. If the employer is also contributing his share on actual salary, ie, Rs 85000, the employee MAY get the benefit of higher pension based on that higher amount of PF qualifying salary when he retires at the age of 58. If the review bench strikes down the verdict of Supreme Court (and of course the High Court of Kerala) which directs the EPFO to pay pension based on actual PF qualifying salary and restricts pension on Rs 15000, then the employer's share on difference amount will be credited to the employees PF. This can be withdrawn by the employee along with his own share of contributions.
3. The employer restricting the PF contribution to 12% of Rs 15000. The employee gets more take home salary. But for an employee whose basic salary is Rs 85000, this is nothing.
4. The employer who allows the employees to contribute on higher salary than Rs 15000, will favour the employee by tax benefits under 80CC. To that extend the employer is employee friendly.
Hope the above clarifies the matter.
From India, Kannur
Eployee can contribute 12% of basic,But employer is not under the obligation to contribute at that same basic,and restrict employer contribution limited to max limit of 15k.
As indicated by Madhu sir,
Its about ,benifits,or statutory compliance or Related to tax exemptions where employer can decide.
From India, Vadodara
As indicated by Madhu sir,
Its about ,benifits,or statutory compliance or Related to tax exemptions where employer can decide.
From India, Vadodara
Dear Concern
w.e.f from 01/09/2014 the celing limit of epf is 15000/- so there is two option for calculation:-
1) If employer pay as per celing i.e 15000 than calculation is
EE share=12% of 15000=1800 ER share Pension=8.33% of 15000=1250 & diff diverted into ER Share pf=1800-1250=550
2) If employer pay on full basic i.e from 85000/- to pf EE Share=85000*12%=10200 ER share pension=1250 & diff diverted into ER share PF=(10200-1250)=8950
I hope the above more clarify your doubt.
From India, Pune
w.e.f from 01/09/2014 the celing limit of epf is 15000/- so there is two option for calculation:-
1) If employer pay as per celing i.e 15000 than calculation is
EE share=12% of 15000=1800 ER share Pension=8.33% of 15000=1250 & diff diverted into ER Share pf=1800-1250=550
2) If employer pay on full basic i.e from 85000/- to pf EE Share=85000*12%=10200 ER share pension=1250 & diff diverted into ER share PF=(10200-1250)=8950
I hope the above more clarify your doubt.
From India, Pune
As per Notification on 01 Sep 2014-
EPS will apply only to EPF members whose pay at the time of becoming PF member is not more than Rs.15000/- per month on or after 01.09.2014 the entire employer and employee contribution shall remain in provident fund and no diversion to EPS shall be made for all new PF members on or after 01.09.2014 having salary more than Rs.15000/- at the time of joining.
So you have to check either member is already registered with some other unit or it is first time .
From India, Rudarpur
EPS will apply only to EPF members whose pay at the time of becoming PF member is not more than Rs.15000/- per month on or after 01.09.2014 the entire employer and employee contribution shall remain in provident fund and no diversion to EPS shall be made for all new PF members on or after 01.09.2014 having salary more than Rs.15000/- at the time of joining.
So you have to check either member is already registered with some other unit or it is first time .
From India, Rudarpur
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