What is PF in private company?

The Employee Provident Fund or the EPF is a retirement benefits scheme for salaried employees in the private sector.

How is PF calculated for private sector employees?

The employee contributes 12 percent of his or her basic salary along with the Dearness Allowance every month to the EPF account. For example: If the basic salary is Rs. 15,000 per month, the employee contribution shall be 12 % of 15000, which comes to Rs 1800/-. This amount is the employee contribution.

How is PF amount calculated?

To calculate your provident fund contribution, add both employer and employee contributions. The employer contributes 12% towards the PF balance, whereas the employee contributes 3.67% towards the PF balance. The employer's contribution of 12% towards the PF balance depends on the employee's basic pay.

Is PF a part of salary?

Gross Salary is the term used to describe all the money an employee has made working for the company in a year. It is the salary that is without any deductions like PF, Income Tax, etc. However, Gross Salary includes basic salary, house rent allowance, special allowance, and conveyance allowance, among others.

What is PF and how it works?

If you are an employee, you pay a certain part of your salary towards the EPF scheme. This amount is often matched with an equal contribution from your employer. The combined amount is then deposited with the Employee Provident Fund Organisation (EPFO).

EPF (Employee Provident Fund) – Calculation, Withdrawal Rules, Interest Rate

How much PF is cut from salary?

Employee contribution to EPF: 12% of salary. Employer contribution to EPF: 3.67% of salary. Employer contribution to EPS: 8.33% of salary subject to a ceiling of Rs.

Who is eligible for PF?

Any salaried employee with a monthly income of less than 15,000 INR needs to compulsorily be a member of the EPF. An employee with a monthly income higher than INR 15,000 (the current prescribed limit) is eligible to become a member of the EPF if he/she gets approval from the Assistant PF Commissioner and employer.

Is PF mandatory for salary above 15000?

If you are drawing a salary higher than Rs. 15,000 per month, you are termed a non-eligible employee and it is not mandatory for you to become a member of the EPF, although you can still register with the consent of your employer and approval from the Assistant PF Commissioner.

Is PF compulsory?

All employees drawing a salary are eligible for EPF. Moreover, it is compulsory for all employees earning less than ₹15,000 to register for the EPF. However, employees earning more than ₹15,000 can also voluntarily stay in the EPF scheme.

What is the rule of PF?

Usually, non-government employers deduct 12 per cent of basic salary as EPF contribution every month while adding a similar figure to it and then depositing it with the EPFO. EPF accounts are mandatory for employees earning up to ₹ 15,000 per month in any firm with over 20 workers.

How is PF calculated from CTC?

Provident Fund-A portion of the salary gets deposited in the PF account of the employee. Employer and employee together contribute to the contribution. The contribution to the PF account is 12 per cent of the basic pay.

What is PF and ESI in salary?

This document describes the rules for ESI and PF Deduction where ESI is Employee State Insurance (ESI) and PF is Provident Fund (PF). These are two social security schemes available to employees working in India.

What is PF interest rate?

The interest rate for the scheme has been retained for the current financial year at 8.50%. “The EPFO has decided to provide 8.50 percent interest rate on EPF deposits for 2019-20 in the Central Board of Trustees (CBT) meeting held today”, states Gangwar.

Why PF is deducted twice from salary?

If the salary is mentioned as CTC, the employer PF amount only will be given in the offer letter. Employee PF amount will not be shown and it will be deducted from the salary. so it is logical only. CTC means cost to the company which is given by the company employee deductions to be not given.

How much monthly pension will I get from EPF?

The pension contribution in the EPF passbook is the amount deposited by the employer every month in the EPS account of the employee. It comes to be around ₹ 1250 every month.

What if company is not paying PF?

Ans : The Employees' PF Organization will invoke penal provisions of the Act to recover the dues from the employer. Complaint can be lodged with Police under section-406/409 of IPC by the EPFO for action against such employers.

Do we get PF after leaving job?

Complete Provident Fund (PF) money can be withdrawn when an individual retires from employment and remains unemployed for more than 2 months. The gazetted officer must certify that the individual is unemployed for more than 2 months for him/her to receive the PF money.

What do you mean by CTC salary 18000?

CTC means Cost To Company. The total cost that a company would incur, on an employee, in a year. Per month salary and other benefits that the company pays an employee, are actually cost to the company. CTC package is a term often used by private sector Indian companies while making an offer of employment.

What are benefits of PF?

How is PF calculated in Excel?

Lets say your salary (Basic Salary + Dearness Allowance) = Rs 50,000 per month. Now following are the contributions made by you (employee) and the employer: Employee's contribution towards EPF = 12% of Rs 50,000 = Rs 6000. Employer's contribution towards EPS = 8.33% of Rs 50,000 = Rs 4165.

When can we withdraw PF?

You can withdraw your entire PF corpus only after you retire. You will be allowed to retire only after you are 55 years old. If you retire before you attain this age, you will not be permitted to receive your entire corpus. However, you are entitled to obtain 90% of your EPF corpus 1 year before you retire.

How much PF can claim?

Under this provision non-refundable withdrawal to the extent of the basic wages and dearness allowances for three months or up to 75% of the amount standing to member's credit in the EPF account, whichever is less, is provided. The member can apply for lesser amount also.

Is PF interest taxable?

1) Any interest credited to the provident fund account of an employee shall be tax-free only for contributions up to 2.50 lakh every year and any interest on an employee's contribution over 2.50 lakh shall be taxed in the hands of the employee year after year.

What is CTC salary?

Cost to Company (CTC) refers to the total salary package of the employee. It is inclusive of all monthly components such as basic pay, reimbursements, various allowances, etc.

Who is eligible for ESI?

To be eligible for the ESI scheme, the employee or the worker's monthly salary should not exceed Rs. 21,000 and Rs. 25,000 for people with disability.