15 September 2019
can an employee opt out of pf while switching over to a new job. While he/she being contributed towards PF in their previous job and not willing to do so in the new job and if the income is more than 15,000.
16 September 2019
If your new company have more then 20 employees, your employer is to recover PF from you and also contribute their contribution ( that is 8.33% to pension fund and 3.67% to PF account). Even your wages is more than Rs.15,000/-, PF is to be recovered for Rs.15000/- from your employer and contribution is to be made for Rs.15,000 by the employer. The contribution of PF over wages for Rs.15,000/- is only optional.
16 September 2019
Thank you sir. What does para 26A of PF means, i was told according to that an employee whose salary is more than threshold can exclude himself from contributing to PF. Could you clarify
16 September 2019
To my best of knowledge, the contribution of employer and employee for PF can be excluded only for the wages more than Rs.15,000/- and wages upto Rs.15,000/- is to be paid. The contribution of PF may be paid for the entire wages if employer and employee opt for it.
I am also sharing one additional information in this regard. If you opt for PF for all the wages, employer contribution to pension fund will be covered only for Rs.15,000/- and for the remaining wages the entire contribution will go to your PF account.
For examplle is salary is Rs.23,000/- and PF is paid for all the wages. Then employer contribution would be
Pension fund - Rs.15,000 x 8.33/100 - 1250 PF for Rs.15000 x 3.67% 550
For the remaining Rs.8000 Employer contribution to PF would be 8000 x 12/100 - rS.900
17 September 2019
Imthiyas, In the given scenario the employee can not opt out of PF contributions upon joining the new employer. You can contact me on aditya@iravya.com for further details, if needed.
CAclubindia
