PF Deduction

[Asked by Guest]

Whether employer and employee contribution of PF should be a fixed amount for every month (or) should be calculated based on the actual pay considering the loss of pay on account of leave.

[CA Rachit Agarwal]

PF amount not fixed, it is the actual payments made. PF is levied on the Basic Amount of salary paid.

AI Summary

Provident Fund contributions calculated on actual basic salary paid, not fixed monthly, and reduced for loss of pay.
PF contributions are calculated on the basic salary actually paid; if loss of pay reduces the basic amount in a month, employer and employee PF contributions correspondingly decrease rather than remaining a fixed monthly amount.