As you know that Provident fund is a fund which is composed of contributions made by the employee during the time he/she worked along with an equal contribution by his employer”
RATE : Provident fund is calculated as 12% of his/her basic salary & the same amount is contributed by the employer.however employee have a option to contribution more than 12%
DEPOSIT OF CONTRIBUTIONS:
Employers contribution of 12% of basic salaryis totally deposited in provident fund account whereas out of employees contribution of 12% , 3.67% is contributed to provident fund & 8.33% is deposited in Pension scheme.
IS IT COMPULSORY FOR ALL EMPLOYEES TO CONTRIBUTE TO THE PROVIDENT FUND?
employees drawing basic salary upto Rs. 1,5000/- have to compulsory contribute to the provident fund . however , employees drawing above Rs. 15,000/- say Rs. 15,001 have an option to become member of the provident fund.
ADVANTAGES:
1. Tax benefit u/s 80C
2. retirement benefit
3. withdrawal benefit
2. retirement benefit
3. withdrawal benefit
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