Sriram (CMA Final) (178 Points)
19 December 2014Dear All,
An existing Provident Fund Employee has got an Job Offer, where his Basic Salary is Rs.20,000/- p.m. Is deduction of Provident Fund mandatory in both cases i.e. Employer Contribution and Employee Contribution. As per my knowledge if basic salary is more than Rs.15,000/- Provident Fund deduction is optional.
Kindly correct me if I am wrong
Thanks in advance
Roshan Thomas
(C.E.O )
(356 Points)
Replied 24 December 2014
Yes, deduction is mandatory since he is already covered under PF. When he joins the new employment he will have to contribute 12% of 20,000 and the employer need to pay only 12% on 15,000 (the max limit).
If this was his first employment, then he could have opted out of PF by submitting Form 11.
Sriram
(CMA Final)
(178 Points)
Replied 25 December 2014
Thank you for your reply.
If the Company hires the existing PF employee on contract basis, still the company is liable to contibute PF?
CAclubindia
