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Contribution to EPF

Top Contractor PF ESI Consultant in Ahmedabad by Connect 2 Payroll Company in India. Contributions to the employee provident fund must come from both the employer and the employee in equal measure. However, how much is it and how is it calculated? Inform us!

Advice: Need to PF ESI Consultant in Ahmedabad by Connect 2 Payroll Services in India?

    Salary is used to compute EPF, where salary is equal to Basic + Dearness Allowance (DA).

    Basic Pay in Private Organizations

    Either 1800 INR or 12% of monthly earnings is contributed to the EPF.

    In other words, your PF account receives 12% of your paycheck.

    Your employer must also make a 12% contribution. However, this 12% is split across two accounts:

    1. 3.67% is the Employee Provident Fund

    2. 8.33% is the Employee Pension Plan.

    In addition, the employer must provide an additional 1% of costs. –

    1. Employee Deposit Linked Insurance (EDLI): 0.5% covers your EPS and EPF.

    2. 0.5% is the EPF administrative fee

The EPF contribution is contingent upon three distinct circumstances.

Situation 1: The worker's pay is less fifteen thousand rupees.

Assuming S1 as the salary, we may thus

    The worker will provide 12% of S1.

    On the other hand, the employer will pay

    3.67 percent of S1 to EPF; 8.33 percent of S1 to EPS; 0.55 percent of S1 to EDLI; and 0.55 percent of S1 to EPF administrative fees

Scenario 2: The worker's pay exceeds fifteen thousand rupees.

If the employer chooses to implement Minimum EPF, the employee's existing income is not used for computation; instead, the minimum salary of 15000INR is used.

    The worker will put in 12% of the fifteen thousand rupees (1800 INR).

    In contrast, the employer will pay 3.67% of $15,000 into EPF, 8.33% of $15,000 toward EPS, 0.5% of $15,000 for EDLI, and 0.5% of $15,000 toward EPF administrative costs.

Scenario 3: The employee earns more than fifteen thousand rupees.

Assuming the company chooses Full EPF and that the employee's current pay is 30,000 INR

    The worker will put in 12% of the thirty thousand.

    However, there are two options available to the employer: A. The company may contribute a total of 12% of the minimum wage of 15000 INR.

    OR B. The company may provide a total contribution of 12% of the employee's existing pay (in this case, 30,000INR). In this instance, 8.33% of 15,000 will still be contributed to the EPS, with the remaining amount going into the EPF.