Defination of salary while taxability of empr's cont. to pf

ASHOK KUMAR MODI (ACCOUNTS EXECUTIVE) (43 Points)

01 June 2015  

Dear Sir,

Employer's contribution to Recognised Provident Fund is Exempt upto 12% of Salary. Thus Contribution made by employer exceeding 12% shall be added to employee’s salary Income.

For the purpose of PF salary is Basic + DA.

If the employer make contribution to Recognised Provident fund @ 12% not on Basic + DA but on the employees' Gross Salary. 

So, whether employer's contribution to Recognised Provident Fund on other than Basic + DA is Taxable or not taxable to employee as rate of contribution is 12%. 

Thanks & Regards,

Ashok Kumar Modi