What is provident fund for employees?
The Employee Provident Fund (EPF) is a retirement benefits scheme in which employees of an organisation contribute a small portion of their basic pay monthly. In the same line, the employer also contributes a similar amount on their behalf towards the scheme.
What is EPF and how it works?
If you are an employee, you pay a certain part of your salary towards the EPF scheme. This amount is often matched with an equal contribution from your employer. The combined amount is then deposited with the Employee Provident Fund Organisation (EPFO).
Who manages PF money?
Ministry of Labour and Employment
How much PF is cut from salary?
You and your employer need to transfer 10% or 12% of your basic salary as contribution towards EPF. In case you are a woman, you only need to contribute 8% of your basic salary for the first 3 years. During this period, your employer’s EPF contribution will remain 12%.
What is the new rule of PF?
EPFO has notified employers that come June 1, if PF accounts are not linked to Aadhaar, then the ECR (electronic challan-cum-return) will not be filled. Employees can continue to make contributions to their PF account but their employer’s share will not be deposited.
What happens if PF is not deducted?
The contributions to PF are eligible for tax deductions under section Section 80C. The employee will miss out on the retirement pension under the Employees’ Pension Scheme (EPS).
Who is not eligible for PF?
EPF eligibility criteria If you are drawing a salary higher than Rs. 15,000 per month, you are termed a non-eligible employee and it is not mandatory for you to become a member of the EPF, although you can still register with the consent of your employer and approval from the Assistant PF Commissioner.
What does CTC include?
The CTC includes all the elements of a salary structure – basic salary, House Rent Allowance (HRA), Basic Allowance, Travel Allowance, Medical, Communication, Provident Fund, Pension Fund, and or any incentives or variable pay.
Why all pay is CTC but all CTC is not pay?
That’s because basic pay and DA have a bearing on other benefits, too, such as EPF and gratuity. If your basic pay and DA come down, your gratuity and EPF come down, too. But if your employer contributes less to your EPF account, your CTC will fall since they are putting less in your retirement account than before.