Go Ad-Free on CAclubindia with Daily Mobile Updates. Subscribe Now!

Admin. charges on pf

Musaib k (Article) (64 Points)

21 February 2012

I know admin. charges on PF are 1.1% of basic. If an employee contributes more than the limit of Rs. 6500,that is he contributes on his actual basic( which is more than Rs. 6500),then will admin. charges be deducted on 6500 or the actual basic on which employees cont. was deducted. In one of the firms an employee was deducting his contribution on RS. 20,000( i.e. 12% on 20,000= Rs. 2400) an dthe firm was paying admin. charges on Rs. 20,000 and not Rs. 6500

Reply
Follow
Share

3 Replies

Kolluru Krishna Murty (Partner) (315 Points)
Replied 23 April 2012

Where the employee has opted to deduct PF on a salary of more than Rs 6500/- and also opted for FPS on more than Rs 6500/-,such employer has to deduct Admn Chages on a salasy on which PF is being deducted i.e. in your case on Rs 20,000/-.

So the employer is right in doing so.

kkm

Upgrade to CAclubindia Pro. Subscribe Now!

Musaib k (Article) (64 Points)
Replied 24 April 2012

But why would the employer bear the extra cost for the employee,he can ask the employee to contribute only on 6500 and thus he can reduce his admin. charges ???