I knew that PF. Would be calculated on Basic salary = / <6500/- But in an organization an employee is paid as under: Basic = 6500/- Fixed D.A = 2000/- H.R.A = 4600/- Spl. Allow.= 4000/- Gross salary = 17100/- where deductions are P.tax = 130/- P.F. 1020/- Net pay = 15950/-
Here P.F is calculated on 6500+2000 = 8500/- x 12%
23 February 2012
Dear Mr.Sankar, As per pf act up to 6500/- basic pf deduction is compulsory, once you deducted 8500/- (basic +da) , you have to continue the same for that employee
CAclubindia
