Scribd
Upload
1K views4 pages

Calculation PF

The document outlines the contribution structure for employee provident fund (EPF) and pension schemes based on different salary brackets. It details the calculations for employees earning below and above the ceiling limit of Rs 6500, including various methods companies may use to determine contributions. Specific examples illustrate how contributions are calculated for both employees and employers, highlighting the fixed nature of certain contributions like the EPS share.

Uploaded by

Rohit Chaudhary
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
1K views4 pages

Calculation PF

The document outlines the contribution structure for employee provident fund (EPF) and pension schemes based on different salary brackets. It details the calculations for employees earning below and above the ceiling limit of Rs 6500, including various methods companies may use to determine contributions. Specific examples illustrate how contributions are calculated for both employees and employers, highlighting the fixed nature of certain contributions like the EPS share.

Uploaded by

Rohit Chaudhary
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
You are on page 1/ 4

Scheme Name Employee Employer Paid to A/c No

contribution (12 %) contribution(13.61 %)


Employee provident 12% 3.67% 1
fund
Employees’ Pension 0 8.33% 10
scheme
Employees Deposit 0 0.5% 21
linked insurance
EPF Administrative 0 1.1% 2
charges
EDLIS Administrative 0 0.01% 22
charges

Sick industries like beedi, jute, guar gum factories, coir industry other than
spinning sector

Scheme Name Employee Employer Paid to A/c No


contribution contribution
Employee provident 10% 1.67% 1
fund
Employees’ Pension 0 8.33% 10
scheme
Employees Deposit 0 0.5% 21
linked insurance
EPF Administrative 0 1.1% 2
charges
EDLIS Administrative 0 0.01% 22
charges

Let us calculate the contribution of an employee who is getting a basic salary of Rs


3500/-

Contribution Towards Calculation Amount


EPF Employees share 3500 x 12% 420
EPS Employer share 3500 x 8.33% 292
EPF employer share 3500 x 3.67% 128
EDLI charges 3500 x 0.5% 18
EPF Admin charges 3500 x 1.1% 39
EDLI Admin charges 3500 x 0.01% 0.35 ( round up to Rs 1/-)

The above calculation is easy .


Calculation of EPF for employees getting a basic salary over and above the ceiling
limit 6500/-

In such cases companies uses different method for calculation as per their pay roll policy.

Consider an employee getting a basic salary of 7500/-

We can calculate it in different ways. The only thing you should take care is, EPS is
calculated only up to 6500/- that means the maximum amount is fixed to Rs 541.00. The
three methods mentioned below are based on the above example.

Method-1

If your company consider total basic salary above the limit fixed 6500.00 for PF
calculation

Contribution Towards Calculation Amount


EPF Employees share 7500 x 12% 900
EPS Employer share 6500 x 8.33% 541
EPF employer share 7500 x 12% (-) 541 359
EDLI charges 6500 x 0.5% 32.5
EPF Admin charges 6500 x 1.1% 71.5
EDLI Admin charges 6500 x 0.01% 0.65 ( Round up to Rs 1/-)

I will explain how Employer contribution of EPS and EPF is calculated.

Employer is decided to contribute on total basic salary which is 12 % on 7500.00 equal to


900.00

EPS Share is fixed to 541.00

Balance (900-541) goes to EPF account 359.00

Total share 900.00

Out of Rs 900.00 EPS share is RS 541/- which is fixed for a basic salary greater than
6500/-. The balance amount is 900-541 = 359.00 which willgo to EPF account.

You may be thinking that, what about 3.67%?, Here you don’t need to care about it.
Method2

Some companies follows the below method in which employee share is calculated on
7500/- and employer share is calculated on up limit Rs 6500/-

Contribution Towards Calculation Amount


EPF Employees share 7500 x 12% 900
EPS Employer share 6500 x 8.33% 541
EPF employer share 6500 x 3.67% 239
EDLI charges 6500 x 0.5% 33
EPF Admin charges 6500 x 1.1% 72
EDLI Admin charges 6500 x 0.01% 0.65 ( Round up to Rs 1/-)

Method3

Some are calculating both employer and employee shares on 6500/- in spite of higher
basic salary than 6500.00

Contribution Towards Calculation Amount


EPF Employees share 6500 x 12% 780
EPS Employer share 6500 x 8.33% 541
EPF employer share 6500 x 3.67% 239
EDLI charges 6500 x 0.5% 33
EPF Admin charges 6500 x 1.1% 72
EDLI Admin charges 6500 x 0.01% 0.65 ( Round up to Rs 1/-)

You might also like