Deducting fixed PF amount

[Former Member]

Hi

We have a scenario wherein we need to deduct a fixed PF amount from the employees every month. This amount is not dependent on the employees' gross.

I could create a wagetype in IT0014 but how do I provide them exemption under Section 80C? Do I need to write a PCR for that?

Please help.

Regards

Divya Tiwari

[Former Member]

Hi Divya,

I have same requirement.  Can you please guide me how you resolved this issue.

Thanks& Regards,

Prasad

[leelamohan_kavali]

Dear Divya,

For this scenarios SAP has given one option where we can maintain exempted amount as per legal rules. so your scenario is your custom wage type has to be acted as like PF?

1. PF amount will be exempted under section chapter VI.

2. Now create one custom wage type & maintain custom wage type in this table V_T7INIA

Note: Custom wage type need to be copied by MLIC only then only custom wage type will appear here then change cumulation & Processing calss

Maintain & check

[Former Member]

Hi KV

Was Public Provident Fund highlighted by mistake? This isn't a PPF contribution.

Yes, the custom wagetype has to act like PF, however, the deduction is fixed at Rs. 25000

I think a PCR  is the way to go.

Regards

Divya Tiwari

[Sanky]

Hi Divya,

Go through my last reply. Have you checked it?

Or else you can do like below

*

/101

      ADDWT *

     AMT=  XXXX

     ADDWT /3F1

in the next pcr,

*

/3E1

      RTE=s /401

      AMT=  /3F1

      MULTI ARA

      AMT+CY /3F1

      ADDWT  /3F6

Two PCR insert after INEPF function.

Check and tell me.

Regards,

Sankarsan

[leelamohan_kavali]

Dear Divya,

Just try and show to Client once he will accept nothing worry rit...!

Because I do have come across same scenario in my present company I've done the same.

Ur's Mohan

[Former Member]

Hi Divya,

Pf calculation is 12% on Basic , DA, Other Allowance (in rare cases) not on the Employee Gross.

for the Fixed PF deduction for every employee you need to create a PCR and insert in the Schema INAL - period factoring and storing after the line PIT X023 with function PIT.

before doing any changes first consult the PF authority and take their approval.

i have one more doubt if fixed PF and other deductions are more than Employee Earnings then what is the solution. if this PF fixed is through out all the positions in the company.

[Former Member]

Hi Praneeth

We'll have to set the DDNTK table accordingly. No, the scenario isn't applicable to all employees. We are deducting PF @12% of basic and DA for the rest.

Only for a few employees we have to deduct fixed PF.

Regards

Divya Tiwari

[Former Member]

Hi,

Then write a PCR with PA EG ESG for which employee's need to deduct the PF fixed amount.

example for pcr:

3

/111

outwpplant

like this you have to create a simple pcr and insert in the sub-schema INAL

[Former Member]

Hi,

Suppose you want to deduct a Rs. 120 for all employees as PF, so In that case your PF basis should be 1000 as per standard PF functinality where we use 12% for India

Payroll. So for that, create 1 display wage type in IT 14 or 15 as PF basis and tick processign class 11 for that wage type. Then upload that wage type for all

employee as fixed amount, it will calculate the fix PF amount for all employee through standard process.

Regards
Mahesh $

[Former Member]

Hi Mahesh

I have already tried the solution provided by you. But this scenario applies only to a few employees, as a result, the amount store in IT0014 wagetype is added to the basis wagetype already generated.

Regards

Divya Tiwari

[Former Member]

I think it can be done using IT0582 (Exemptions).

1. Create a w.t 

2. Maintain INT7 & INT9 & INA9

3. Maintain INCTX function in sub-schema INN1

Please note this is just a suggestion, am not sure whether it is a perfect solution.

[Sanky]

Hi Divya,

Are you maintaining PF Basis amount in IT14?

Regards,

Sankarsan

[Former Member]

Hi Sanskaran

We aren't maintaining PF Basis. The requirement is to deduct a fixed PF amount every month i.e. 25000 irrespective of the employee's gross.

Regards

Divya Tiwari

[Sanky]

OK,

That means EE PF Contribution would be 25000 and same amount will be from ER PF Contribution also?

Am i right?

Regards,

Sankarsan

[Former Member]

There is no employee PF contribution to be deducted from SAP.

Regards

Divya Tiwari

[Sanky]

Hi Divya,

maintain the fixed deduction value in IT14 and pass that value to /111 technical wage type.

For this employee make different Provident Fund ID where maintain 1% in EE contribution.

In INEPF function /111 and /3E1 value will come same whatever value you maintained in IT14.

Check.

Regards,

sankarsan

[Former Member]

Hi Sanskaran

The solution you've provided is a little sketchy. Could you please elaborate?

Regards

Divya Tiwari