Pf Contribution Includes Special Allowance - PDF Download

Dear All,

Hope you are doing good,

Query on PF contribution does special allowances is considered while calculating PF .

Please let me know how PF contribution has to be calculated.

PF is calculated on Basic +DA+ SA or only on Basic + DA

I have got to know PF contribution has to be charged on Basic + DA+ SA .

PF is not mandatory when basic is more than 6500 .

We have not kept the option open for PF contribution whose basic more than 6500 PF is not mandatory when employee has join.

Now Management decided to implement PF non mandatory option open to all staff whose basic is more than 6500 from this fiscal year .

I have query if we have already deducted PF from staff whose Basic was more than 6500 now management decides to make PF as non mandatory option open after taking into employee consideration his willingness not to contribute for PF. I would like to know can we do this in between stop PF contribution for employees whose basic more than 6500 in future will PF department raise query that why particular employee contribution has been in between suddenly stopped.

Please HR folks & compliance folks share your views on PF calculation.

Special allowance paid to all employees in general as a component of salary will be treated as part of statutory salary for the purpose of PF contribution whereas if it is paid to a particular employee or a particular category of employees taking into consideration the special skill required to perform the job will be treated as such as special allowance.

The Madras High Court in R Ramanathan Chettiar Jewellers, Madurai vs. Regional PF Commissioner, Madurai – 1988 (ii) LLJ 045, has pointed out that a payment which is not of a regular nature and is paid purely in the discretion of the management, would not be available for PF contribution. In Associated Cement Company Ltd. and Ors. v. R.M. Gandhi, Regional Provident Fund Commissioner, Gujarat(1995-III-LLJ(Suppl.)-368), it has been held that ad hoc payments made to ‘eligible employees and not to all employees’ under agreement does not form part of basic wages for PF contribution.

Though it is optional for an employee whose salary (PF qualifying salary) at the time of joining the establishment exceeds Rs 6500 to become member, an employee once covered should continue his membership so long as he is in employment. Therefore, if you have given coverage to those whose salary exceeded Rs 6500, you should continue the coverage and you cannot stop it even if the employees give their consent to stop it. Certainly, the employer can restrict his contribution to 12% of Rs 6500 even at a later stage. The employer who has been contributing on the total salary of employee which was higher than Rs 6500 can restrict it to Rs 6500 at a later stage as is decided by the Apex Court in Marathwada Gramin Bank Karmachari Sangahatana and another Vs Management of Marathwada Gramin Bank and others(SC 2011 LLR 1130)

Regards,

Madhu.T.K

no need to add special allowance for PF contribution....If the wage minimum of Rs.6500/- we should have to include like CCA,Conveyance, other allowances..IF the wage of Basic+DA reach Rs.6500/- we no need to include any other allowances....

dear sir
what is difference between esi & pf
how many register have to maintain in pf
how to calculate bonus

Dear,
PFA the 1 case study & 1 scan copy from PF book which will help you understand the impact.
Regards,
Zameer Ansari.

Dear Zameer Ansari ji,
The case which you have highlighted is a Madras High Court case. Apparently the query raised by Shri. Milind Kamble seems to be from Mumbai, Maharashtra.
In Maharashtra, special allowance denotes Cost of living allowance i.e. dearness allowance.
It is suggested to change to nomenclature of Special Allowance to some thing else, such as City Compensation Allw., or any other other allowance.
Thanks and regards.
Keshav Korgaonkar
Shantadurgaent.com,Insurance Advisors,Corporate Advisors,Legal Advise,Wage and salary,Shantadurgaent.com,Labour Compliance Audit,SSI registration,NOC from

Hi,
I would like to thanks those who have given me their inputs on PF.
Last week we had PF inspection i would like to know after PF inspection closed do we get copy of Pf inspection from PF authority.
We got to know from that Pf inspection acknowledgement copy we will not be getting. They will just show us the copy .
Please reply..

please anyone can tell me that if i have two employees
1st with gross salary of 6000
2nd with gross salary of 9000
what will be their salary break up and on what amount their PF will be deducted according to new slab 15000/-

EPF UAN based up lode, employees left service which Coolum mention.

can anybody tell me about the salary break up for 10000 and the allowances what has to be update