New Wage Code to be available from April 1, will be a big benefit, may double the Provident Fund

New Wage Code to be available from April 1, will be a big benefit, may double the Provident Fund

PF Calculator: New Wage Code will come from 1 April 2021. Labor Ministry has completed preparations to implement it. With this, the take home salary, PF and Gratuity of private jobs will be completely changed. Cash in Hand salary will also make a difference. It is expected to decrease. But old age will be more secure. According to experts, if the monthly salary decreases, then there will be more reduction in PF. This will give a big fund after retirement. Gratuity will also increase with this.

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New Wage code PF Benefits: If monthly salary is 50 thousand rupees and basic pay will be 15 thousand rupees. Then on retirement, the amount of PF will be Rs 7,14,53,72.

At the same time, the basic salary in the new Wage Code will be 25 thousand rupees a month. Then on retirement, the amount of PF will be Rs 1,19,08,953. Here annual increments have been taken at 5 percent, which will further increase the PF fund.

What is Cost to Company

New Wage code benefits: The cost incurred by a company on its employees is CTC. This is the complete salary package of the employee. CTC includes monthly basic pay, allowances, reimbursements. At the same time, gratuity, annual variable pay, annual bonus etc. are included on an annual basis. The amount of CTC is never equal to the take home salary of the employee. CTC has many components so it is different. CTC = gross salary + PF + gratuity

Basic salary

PF Calculator New Wage Code: Basic salary is the base income of an employee. This fix is ​​based on the level of all employees. It is according to the position of the employee and the industry in which he is working.

Gross salary

PF Calculator New Wage Code: Gross salary is the salary that is added to basic salary and allowances without deducting tax. This includes bonuses, overtime pay, holiday pay and other item allowances.
Gross Salary = Basic Salary + HRA + Other Allowances

Net salary

Net salary is also known as take home salary. The salary that is made after the tax is deducted is called net income.
Net Salary = Basic Salary + HRA + Allowances – Income Tax – EPF – Professional Tax

Source:-zeebiz

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