The central government of India has released a notification to reduce the PF contributions to 10% from 12% for the months of May, June, and July 2020 due to the COVID 19 lockdown. The reason for taking this decision is to increase liquidity. So now 10% of employee’s basic wages + DA will be deducted for PF and even employers also contribute only 10%.
The Inhand salaries of the employees for the months of May, June, and July 2020 are going to increase and the government of India is telling that which will increase the spending power the public.
Quick Summary of This Change in EPF Contribution:
- PF contribution reduced to 10% for both employees and employers for the months of May, June, and July 2020.
- This change is not applicable to the public sector companies under state government and central government, they have to pay the previous 12% PF contribution.
- This is change is not applicable to the companies which are getting benefit under PM Garib Kalyan Package. ( Under this scheme the government is paying 12% PF contribution of both employees and employers for the establishment which have up to 100 employees and 90% employees with below 15000 Rs wage