Provident Fund :EPS contribution advise please

[former_member201807]

Hello,

We have process the salary for the month of July 2015, the details are given below:-

Date of joining: - 22.07.2015

Basic salary: 20,000.00

We would like to generate the PF monthly details for employee Id-988280, employees has worked days =9,

The PF details are given below:-

Basic salary:  Rs. 20,000.00

EPF wages: (20000/31)*10 =Rs. 6451

EPS wages:  (15000/31)*10 = Rs. 4839

Now end use said that EPS wages is (Rs.6451) instead of Rs. 4839, while pension is calculated on EPS wages.

(Pension = EPS wages* 8.33% or maximum 1250)

Please suggest!

Regards,

[former_member201807]

Hello Team,

Client wants to know which option is applicable as per provident fund act, specially when employees joined mid of the month.

Due to joining mid of the month EPS wages is less than Rs.15000/-

Please suggest!

[Sanky]

If employee joins in mid of the month then select the eligibility pf amount or pf basis of EPS it's depend upon the client business process.

if clients wants that     eps basis is equal to pf basis then they should go for 2nd option of basis.

Regards,Sankarsan

[venkateshorusu]

General practice is Eligible pay or PF Basis which ever is less.  What practice should be followed for an Organization should be decided by business owners, Accordingly we suggest how master data should be maintained in the system.

Regards

Venkatesh

[Sanky]

Hi,

Check in the IT587 details.

Radio button should in the PF basis part in the Pension contribution section. Check attached screenshot. Calculation will trigger as per user requirement.

Regards, Sankarsan

[former_member201807]

Hi Sankarsan,

Client is using first option i.e.

Contribution towards pension scheme

Basis for contribution Eligible pay or PF basis whichever is less

Client wants to know which option is applicable as per provident fund act, specially when employees joined mid of the month.

Due to joining mid of the month EPS wages is less than Rs.15000/-

Please suggest as per Provident fund act!

Regards,

[Sanky]

Hi,

If they are using the 1st option then calculation is ok.

There have no such criteria that select the 1st option or 2nd option. It's totally depend upon the client business process.

If they are selecting 2nd option then employer side contribution will go higher if PF basis is more the eligibility pay i.e. 15000.

Regards,

Sankarsan

[venkateshorusu]

For more information go through function INEPF you will get an idea.

Regards

Venkatesh