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How to Calculate Provident Fund Deductions

How to Calculate Provident Fund Deductions? 

The Provident Fund system in India works pretty much on the mandates and the guidelines provided on the same by the government of India, and the Provident Fund Act 1952. The calculation to ascertain the amount of deductions to happen is not at all complex in nature. It’s a very simple calculation based on the components of the salary for the person concerned.

In case of person whose salary would comprise of components like basic, DA (dearness allowance), employee retention allowance in that case it would be a total 10% of all the three components of the salary. And the employer would also contribute an equal amount towards the Provident Fund account contribution of the employee and the same would be deposited in to the Provident Fund account for the employee.

The state would provide tax benefits and annual interests on the savings which might differ from year to year. The interest rate for the EPF is around 8% to 12% and is decided by the government and the central board of trustees. Currently for the year 2016, the rate of interest is 8.75% per annum 

Again in case the salary of the employee is comprised only of Basic pay, and no DA (dearness allowance), employee retention allowance in the salary. In that case it would be a total 12% deduction from the basic components of the salary. In this case also the employer would contribute an equal amount to the employee’s contribution and the same is deposited to the Provident Fund account for the employee. The contribution from the state also remains the same. And the tax benefit is provided US 80C. However in both the cases the employee might choose for an enhanced saving of upto 100% of his basic.

Periodic or annual statements are supposed to be provided by the employer to the employees about the deposits made to the credit of the employee’s Provident Fund account which should be based on the same calculation. In case a deviation is seen, its advisable to verify the same with the employer.


the maximum limit towards PF contribution is on Rs 6500, can Employer contribute more than the limit if emloyee is contributing.

Dear Friends, if i got salary rs.25,000/- per month. Howmuch PF deduction for my salary? How to calculate PF deduction for this amount

Rs. 25000, plz tell how much is the basic pay from it,(Suppose 'x' basic) then 'x' *12/100=PF amount. (@12% of basic pay)

Hi, My basic is 6500 and employer is told that the PF is 12% of the basic and we only have to contribute the employers %tage too! In pay slip, the employer doesn't mention the percent of PF deduction. When i got the offer letter, they mentioned that the basic is 2700 and now suddenly it is 6500. What is the solution for this and how can i ask this legally. Please help me out soon.

PF must deducated either your salary 4000/- or 25000/- New rule of pf Deducated 12% of Basic Salary (If u have not basic salary than apply on total salary.

1. 9000 salary 2. 9000/60% = 5400 basic 3. 9000-5400(basic) = 3600 allowance 4. (basic)5400/12% = 648 pf 5. (total salary) 9000/1.75% = 157.5 esi NOTE: THERE IS NO ESI DEDUCTION FOR SALARY ABOVE 10000.

Hi, Can you Please tell me how to calculate PF in an IT Software company as per GOVT rules? Suresh Immadi

there is no such rule for IT companies... Firstly, ADD Basic & Dearness Allowance (DA)... then calculate its 12%.... Example: Mr X salary is 15000.00 His Basic is 5000 & DA is 2000 So Basic + DA is 7000 SO, PF deductiom = 7000*12% i,e RS 840

Dear Sir/Madam, The deduction of my Provident Fund is from Dec 2004 & I had left the service on 10th Nov 2008 still i have not claimed the provident fund. How much amount can I get with interest form my provident fund account. I would like to know the @ of interest on my Provident Fund amount for so many years, approx. 9.5 years. Total Contribution of Worker's & Employer's Share Year Wise is as follows:- Period Worker's Share 12% Employer's Share Total of Basic Salary 3.67% 8.33% Share Dec-04 to Mar-05 2083 637 1446 4166 Apr-05 to Mar-06 6706 2051 4655 13411 Apr-06 to Mar-07 8237 2519 5718 16474 Apr-07 to Mar-08 9792 2995 6797 19584 Apr-08 to Oct-08 5712 1747 3965 11424 Total 32530 9949 22581 65059 Please do the needful at the earliest, Sorry for the inconvenience caused to you, Thanking You RAJESH R. PATEKAR

hi my current salary ctc 17000,can u tell me after pf deduction, how much my salary in hand, and no other deduction from my salary.

Can you tell me. what percent of ESI and PF amount all the company could deduct per month. will it differ from IT and Non IT?

Hi , If my salary is rs.20,000/- per month. How much PF deduction for my salary? How to calculate PF deduction for this amount ?

we are employer and employed a person on daily wages. now how much amount of PF to be deducted from his salary on which basis. whether PF to be deducted of weekly off (Sunday)

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