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Provident Fund (PF)

From this page, you can create the Provident Fund (PF) Slabs. Provident Fund (PF) is a statutory deduction applicable to eligible employees. All fields are used to define the PF slab structure and contribution percentages for both employees and employers.

To open this, navigate to Payroll->Payroll Configurations->Salary Components->Provident Fund.

PF Slab Name:

Enter a name to identify this provident fund slab.

Upper Limit:

Enter the cap limit for the employer's contribution, which will be the maximum amount on which the employer's contribution will be considered, even if the basic salary exceeds this upper limit.

Tax Exempted:

Enable this option to mark this PF slab as tax exempted. Selecting this enables investment type selection for tax exemption purpose.

If Tax Exempted is selected then select Investment Type

Investment Type:

Select the investment type applicable for tax exemption — for example, U/S 80C. This field appears only when Tax Exempted is enabled.

Apply Based on Attendance:

If the PF calculation for any PF type is based on a fixed amount or a specified amount at that time, should the amount be directly deducted, or should it be considered based on the actual attendance rate for that amount?

PF Contribution Configuration:

This section defines the contribution percentages for each PF component/Type — for both the employee and employer side.

The following components can be enabled:

PF:

This is the main provident fund contribution. Check this box to enable PF deduction for both employee and employer.

EPS:

Its full form is Employee Pension Scheme contribution. Check this box to enable EPS deduction.

EDLI:

Its full form is Employees' Deposit Linked Insurance contribution. Check this box to enable EDLI deduction.

PF Admin:

It means the administrative charges applicable on the employer side. Check this box to enable PF Admin charges.

For each enabled component, configure the following for both Employee Contribution and Employer Contribution:

Calculate On: Select the salary component on which the contribution will be calculated:

  • Actual — contribution is calculated on the actual value(The components for the actual Value can be configured inside the salary structure as PF calculated on)
  • Fixed — contribution is calculated on a fixed amount(For this if needed attendance based then we can mark as select to the Applicable based on attendance)

Value (%): Enter the contribution percentage for the selected component. For example:

  • PF Employee contribution — 12%
  • PF Employer contribution — 12%
  • PF Admin Employee contribution — 0%
  • PF Admin Employer contribution — 1%

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The Bulk Action button allows you to delete multiple PF slabs at once, streamlining the management process.

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