LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Guide me plz

RamaKrishnan (Student ) (120 Points)

19 July 2008

I have offered CTC Rs.2 Lakhs with a Basic of Rs.8, 000/-

Our HR person has informed me that my Basic exceeds Rs.6, 500/- hence, PF deduction is not compulsory.

If I haven’t opted PF deduction then I can take home my salary without any deduction.

If I have opted PF deduction, then the company’s share also will be deducted from my salary (that is CTC).

If I choose PF what benefit can I enjoy?

If not what am I loosing?

Guide me plz.

Reply
Follow
Share

2 Replies

Amol (Investments) (40 Points)
Replied 19 July 2008

The Treshhold for compulsory PF deduction is 6,500 basic. For salaried employees drawing basic above that the PF deduction is optional.

As per the trend prevailing now, CTC is supposed to include employer contribution also.

If u do not opt for PF, u will have higher take home subject to applicable Income Tax.

If u opt for PF deduction, then the employer contribution will not be part of your taxbale salary income and your contribution will qualify for deduction u/s 80 C. So, there will be lower taxation as well as lower take home.

U consult HR and ask them to give you actual numbder under both the option and then decide.

AMOL

Ram Avtar Singh (Nagari Sultanpur U.P.Delhi) (14477 Points)
Replied 19 July 2008

Originally posted by :RamaKrishnan
"	I have offered CTC Rs.2 Lakhs with a Basic of Rs.8, 000/- Our HR person has informed me that my Basic exceeds Rs.6, 500/- hence, PF deduction is not compulsory. If I haven’t opted PF deduction then I can take home my salary without any deduction. If I have opted PF deduction, then the company’s share also will be deducted from my salary (that is CTC). If I choose PF what benefit can I enjoy? If not what am I loosing? Guide me plz.	"