Pf Deduction Option-to Do Or Not To Do - DOC Download

Dear All,
Please suggest....
In case the company gives u an option..whether to get PF deducted or not...
What is the better option.
Since my basic is above 25000 pm (which is above 6500pm) I have an option here.
Please give suggestions with reason that why should I or why I should not have PF deducted
Thanks
1st May 2014 From India, Delhi

Hello Kanika, Every one has to deduct the PF * To save tax * To avail Pension benefits * To Avail EDLI benefits * To earn interest Regards, Ashish
1st May 2014 From India, Pune

Hello Kanika
Provident fund is a component which is useful for every individual who is an employee and associated with any of the organizations. It depends on the employer/organization whether they have the policy of deduction for PF contribution and also you must be aware if they have generated respective PF account number against teh deduction made on behalf of the employee.
I would suggest you go ahead with PF which will act as one of the saving along with the opportunity to get tax rebate if you fall in the tax bracket.
Regards
Jeevan
1st May 2014 From India, Thiruvananthapuram

In my view , becoming a member of EPF on higher salary also is beneficial because of many reasons such as compulsory saving, getting higher interest than market rates, becoming eligible for Pension after 10 years service , getting benefit of insurance without any contribution, security of family pension in case of death etc.
Otherwise also, one can get back his money along with interest if leaving the job. The present computerised system in EPFO is making the procedures very simple and fast.
Chandok AK
RPFC (Retd.)
www.akchandok.com
2nd May 2014 From India, Chandigarh

It is always beneficial to subscribe to P.F even if you are not within the purview of the Act. Apart from the benefits of providing you a lump sum amount to tide over the hardship of sudden loss of income on retirement, it can provide you with regular pension after retirement to secure your future as well as entitles you to insurance benefits.It is very difficult to save from the salary in the modern life style where the temptation for spending is irresistible with a new model with more attractive features surfacing in the market every day either in mobiles or T.Vs or garments or goggles or cars, not to speak of the race to compete with colleagues or neighbors to own these material possessions Therefore there needs to be a forced saving. The P.F option provides that.This apart,you can get exemption from income tax on the P.F contribution as well as on the lump-sum amount payable on retirement which you would be paying otherwise since savings will be meagre for a salary of Rs.25000/-p.m given the cost of accommodation, children education in good schools, conveyance, medical care and the daily food basket.

Hope this helps.

B.Saikumar

In House HR & IR Advisor


2nd May 2014 From India, Mumbai

kanika ji,
pf deduction is better for you because employer have to contribute extra amount of pf in your account which may be calculated on sealing limit i.e. Rs.6500/- and interest recd on pf is exempted by income tax
so in my perception deduction of pf will be fruitful for you
2nd May 2014 From India, Dehra Dun

Dear Kanika,
Learned friends have provided you appropriate suggestions & advice. You might need little more detailed a/c of PF which is in the attached notes. Use them to your advantage.
All the best.
2nd May 2014 From India, Bangalore

Attached Files (Download Requires Membership)

Benefits from PF.doc (86.0 KB, 205 views)

Its an optional option for an individual having basic more than 6500 cap, if employee is not an old subscriber. in case of old subscriber they he /she has to deduct despite of basic caps.
2nd May 2014 From India, New Delhi

[Its an optional option for an individual having basic more than 6500 cap, if employee is not an old subscriber. in case of old subscriber they he /she has to deduct despite of basic caps.
2nd May 2014 From India, New Delhi

Dear Kanika,
Our learned members especially Mr. Kumar have given a very detailed features of EPF & MP Act. I would like to add further that even yr VPF contributions will get you attractive nontaxable return in the range of 8.5 to 9.5 in the normal course which if you convert for an individual in tax bracket of 30%, will reckon to 12 to 14% which in the present scenario can never be imagined of. Unless you become member of EPF, you cannot contribute under VPF and avail the hidden benefit.
Hence, in short, opt for EPF and have a very nice corpus thru VPF contributions with highest returns.
Rgds.
2nd May 2014 From India, Mumbai