Salary for the purpose of provident fund

[umesh gupta]

valuation of basic wages for calculation of p.f.

[Surender Gupta]

See fourth schedule of the Income Tax Act, 1961 which says, "(h) "salary" includes dearness allowance, if the terms of employment so provide, but excludes all other allowances and perquisites." https://www.taxtmi.com/acts?id=3512

AI Summary

Salary definition for provident fund: dearness allowance included only if employment terms provide, other allowances excluded.
Dearness allowance is treated as salary for provident fund valuation only where the terms of employment expressly provide for its inclusion; other allowances and perquisites are excluded from the salary base used for provident fund calculations, requiring reference to contractual terms to determine inclusion.