Pf deduction

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Krishna Gautam

CA in Practice

23 Points Posted on 25 August 2011

Hi,

I am auditing a Private Limited Company. During the audit i came across the PF part. What i found that there are around 120 employees in this particular company and the assessee company is deducting PF on the limited 12 employees of the company. When i asked this particular question why are they deducting PF on these particular 12 employees, the head of accounts department said all the PF work is done through a PF Consultant and it is their discretion whether to deduct PF or not because their salary is more than Rs.6500/-. Can anybody tell me is it right to deduct PF on 12 instead of 120 employees? Please tell me as soon as possible referring the PF Act.

I think it should be deducted on all 120 employees? What's your take on this?

Replies (2)

Dhanabal Ramasamy

CHARTERED ACCOUNTANT

112 Points Posted on 26 August 2011

Hai..

The company's contention is correct. PF is to be deducted only to the employees whose income is less 6500/- per month as per EPF act. so it need not be dedcuted for 120 employees but to only 12 employees...

Krishna Gautam

CA in Practice

23 Points Posted on 26 August 2011

https://www.citehr.com/274872-pf-deductions-basic-above-rs-6500-a.html#axzz1W3sPW8KF

Check this link. It says if employees do not want to deduct their PF then they have to give a declaration in Form 11 that they don't PF to be deducted from their salary.