This document outlines new PF calculation rules and examples relevant from May to July 2020 for career growth and starting a consultancy. It details changes to contribution rates, impacts on employees and employers, and addresses common questions regarding eligibility and exemptions. The information is intended for sharing on a Telegram group, along with resources for further discussion.

1. New PF Calculation + Rules + Q&A
May’20-July’20

2. Courses For Career
Growth & Starting
Your Own
Consultancy

3. This document covers pointers about
New PF Rates
What will we cover?
● New Calculation, rules and Examples
● S.O. 1513 (E) S.O. 320 (E) PF Section 6
● How it will impact employee & employer?
● Common Questions
Let’s discuss !
This document will be shared on our telegram
group
Overview

4. Let’s Understand the Notification
& it’s complicated ….

6. What Does this notification say?

8. So what is S.O. 320 (E)?

12. Section 6 of PF act 1952

13. Ten percent” (10%) appears in 2 places.

14. Section 6 ( cont )
the Central Government published its
notification 320(E) dated 9th April 1997 stating
list of all establishments that can continue to
contribute at 10%

17. Exclusive offer for LLA subscribers!
Zero Brokerage Demat Account
Open Demat Account with our link and get a lot of benefits from Upstox

19. Now central government has added
clause no “V” in above notification
via 1513(E) dated 18th May, 2020

21. New Contribution Rates

23. *EDLI & Admin are
notional only as
they are calculated
on overall challan
value
Take Home Salary
increase for
employee but CTC
reduces
Example for PF Wage 10000/-
Account Head
EE PF ( A/C #1)
ER PF (A/C #1)
ER EPS (A/C 10)
ER EDLI (A/C 21)*
ER ADMIN (A/C *
Effective CTC
Effective %
May-Jul’20
1000/-
167 ( 1000 - 833 )
833/-
50/-
50/-
11100/-
21%
April 20
1200/-
367 (1200 - 833 )
833/-
50/-
50/-
11300/-
25%

24. Applicable on ALL establishment except
● Central and State Public sector
enterprises
● Establishments owned or controlled
of the Central govt or State govt.
● establishments eligible for PMGKY
benefits

25. Applicable in months
● May’20 paid in June’20
● June’20 paid in July’20
● July’20 paid in Aug’20

26. Common Questions

27. Are exempted establishments eligible
for reduced rate of contribution?
Yes

28. For Fixed CTC what needs to be
done?
The difference in employer share
(2%) needs to be paid to employee.

29. Can employer/ employee pay at
higher rate?
Yes

30. How to avail reduction?
Prepare ECR as per 10% and select

31. Will it impact pension?
No, Pension remains 8.33%

32. What if ECR not submitted on time?
No Problem

33. Applicable if availing PMRPY benefit?
Yes

34. Applicable to newly registered est..?
Yes

35. What if rate already 10%?
It remains 10%

36. Courses For Career
Growth & Starting
Your Own
Consultancy

37. Follow us on This Document will be shared on our
Telegram Group,
Download Telegram & search
Labour Law Advisor