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What is provident fund in salary?

Updated: 10/10/2023
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9y ago

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The Government wants to tell us the importance of routine saving over a long time. This lumpsum given during retirement can be used by the employee to continue his life without being financially dependent on anyone and stand on his own legs...

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14y ago
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10y ago

Provident fund is a retirement corpus that is provided to all employees. Every month 12% of your basic salary is deducted and deposited into the PF account for as long as you are employed. At the time of retirement this corpus, including the accumulated interest is paid out to you

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10y ago

For every employee 12% of his/her basic salary is deducted and contributed as Employee contribution of PF. Similarly another 12% is added by the employer and contributed as Employer contribution to PF

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10y ago

The EPF or Employee Provident Fund is created by the Employees Provident Fund Organization (EPFO) of India, a statutory body of the Indian Government under the Labor and Employment Ministry. It states that an organization having 20 or more permanent employees on its payroll, should register with the EPFO.

A Provident Fund is a fund that is created, through contributions, to provide financial support to individuals in their future (Specifically for post-retirement). The Employee Provident Fund is just such a fund. Contributions are made on a monthly basis, by both employees and employers, thereby encouraging employees to save a portion of their salary each month. Investments made by millions of employees across India are pooled together and invested by a trust.

The EPF is a tax free investment instrument for the salaried class. Interest earned on it is tax free, and returns are also not taxed. You also get a deduction under Section 80C for contributions made towards your EPF.

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10y ago

It is the amount of money that goes from your salary towards the EPF account

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10y ago

It is maintained with the EPF Organization in India which is owned by the Indian government

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10y ago

If he employs more than 20 people as permanent employees - Yes

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Related questions

How provident fund calculating?

If basic salary is Rs. 10000 the PF is 1200. It is 12% of the basic salary


What percent should you deuct in Provident fund challan?

12% of the basic salary


How much will get total er amount in provident fund?

It depends on how much your salary is. Usually it is 12% of your basic salary


What is the percentage of employer's contribution to provident fund on employee's basic?

It is 12% of your Basic Salary


What pe rcent of salary goes to Provident Fund?

it is 12% of your basic salary. you can add more volunteerly, if u want.


What is the provident fund amount that employers should contribute?

12% of the basic salary paid out to the employee


What is the employers share in provident fund?

It is the same 12% of your basic salary as you contribute to PF as employees share


What is the percentages of employee provident fund?

Contribution is 12% of the basic salary and the current interest rate is 8.6%


When was Central Provident Fund created?

Central Provident Fund was created in 1955.


What is the interest rate on unrecognized provident fund?

There is no such thing as an Unrecognized provident fund. The rate of interest on provident fund in India is 8.6% per year


Is there a maximum contribution for provident fund?

No. It is usually 12% of your basic salary with no upper limit as long as you and your employer agree.


What journal entry for provident fund?

To record employee contributions to the provident fund: Debit Provident Fund Expense and Credit Employee Contribution Payable. To record employer contributions: Debit Provident Fund Expense and Credit Employer Contribution Payable.