Enrolling Payees in Provident Funds

This chapter provides overviews of provident funds, provident fund reports, and provident fund deductions, and discusses how to enroll payees in a provident fund program.

Understanding Provident Funds

Payees who are employed by a company must join a recognized Provident Fund. The employers category determines which Provident Fund the employees should join. For instance, all government employees will be covered under Government Provident Fund (GPF). Private sector employees are generally covered under the recognized Provident Fund. Organizations have a choice to be covered under the Regional Provident Fund Commissioner (RPFC) or have their own set up, formed under a ‘Trust’, which will report to the RPFC periodically. Generally large employers have their own trusts, and the onus of managing the contributions rests on the employer itself, guided by a board of trustees. It is important to note that PeopleSoft does not provide for the compliances of a Trust, it provides only for employers covered under the RPFC.

Provident Funds work by deducting a fixed percentage from the salary of the employee and the employer also matches the contribution, which is remitted to the account of the employee maintained by the RPFC. Contributions from the employee and the employer are remitted every month by a certain date. Upon an employees retirement/death/permanent disability, the accumulated contribution along with interest is paid to the employee or his/her legal heirs.

Note. Employees provident fund contributions are paid fully into the PF account, while the Employer’s Contribution is split into Contribution towards Pension (PF ER PEN) and contribution towards Provident Fund (PF ER).

With Global Payroll for India you can:

Define the type of provident fund chosen by the company (statutory provident fund or recognized provident fund).
Ensure that all payees are registered with a provident fund and capture the personal information for the payee and their beneficiaries.
Define the three programs under the provident fund and the calculation methodology for each (Employees Provident Fund Scheme, Employees Pension Scheme, and Employees Deposit-Linked Insurance Scheme).
Ensure that the deductions for payee contributions are properly calculated and deducted on a monthly basis.
Ensure that the employer contribution is properly calculated.
Ensure that the monthly contributions are correctly deposited with the proper provident fund authority.

Note. PeopleSoft delivers several queries that enable you to retrieve provident fund information.

See Also

Delivered Queries

Understanding Provident Fund Reports

As part of the provident fund process, you need to generate and submit certain reports such as:

A remittance statement report that includes details on provident fund contributions that were deducted for the contribution period.
A new provident fund registration report that identifies new payees that must be registered with a provident fund.
A terminated employees report that identifies payees who have terminated employment.

See Also

Creating Payee Reports

Understanding Provident Fund Deductions

This section discusses:

Delivered provident fund deductions.
Viewing delivered elements.

Delivered Provident Fund Deductions

Global Payroll for India delivers the following elements to process provident funds:

PF

Use the PF deduction to calculate the employee's provident fund contribution.
PF VOL

Use the PF VOL deduction to calculate the employee's voluntary provident fund contribution.
PF ER

Use the PF ER deduction to calculate the employer's provident fund contribution.
PF ER PEN

Use the PF ER PEN deduction to calculate the applicable percentage of the Employer contribution.
PF ER ADMIN

Use PF ER ADMIN deduction to calculate the employer's provident fund administration charge.
PF ER EDLI

Use the PF ER EDLI deduction to calculate the employer's EDLIS contribution.
PF ER EDLIA

Use the PF ER EDLIA deduction to calculate the employer's EDLIS administration charge.

See Also

Defining Earning and Deduction Elements

Viewing Delivered Elements

PeopleSoft delivers a query that you can run to view the names of all delivered elements designed for India. Instructions for running the query are provided in PeopleSoft Enterprise Global Payroll 8.9 PeopleBook.

Enrolling Payees in a Provident Fund Program

This section provides an overview of provident fund program enrollment and discusses how to enroll payees in a provident fund program.

Understanding Provident Fund Program Enrollment

To enroll a payee in a provident fund program:

Make sure the establishment provident fund registration information is entered on the Provident Fund Registration page.

See Entering Provident Fund Registration Information.
Enroll the payee by using the PF Enrollment (provident fund enrollment) page.

See Enrolling Payees in a Provident Fund Program.

Page Used to Enroll Payees in a Provident Fund Program

Page Name	Object Name	Navigation	Usage
PF Enrollment (provident fund enrollment)	GPIN_PF_ENROLL	Global Payroll & Absence Mgmt, Payee Data, Pension Information, Define PF Enrollment IND, PF Enrollment	Enroll a payee in a provident fund program.

Enrolling Payees in a Provident Fund Program

Access the PF Enrollment page.

Provident Fund Details

Effective Date	The effective date must be on or after the payee hire or rehire date. If the effective date is before the hire date for the payee, the system issues an error message.
Registration Number	Enter the payee’s provident fund registration number. This number will generally be available a month after the employee is hired.
Registered	Select if you have a provident fund registration number for the payee.

Voluntary Contributions

Percent	If the payee elects to contribute an additional percentage beyond that legally mandated, enter the percentage.
Amount	If the payee elects to contribute an additional amount beyond that legally mandated, enter the amount.

Note. The voluntary contribution for the payee can be either a percentage or an amount. You cannot enter both.

Beneficiaries

Dependent/Beneficiary ID	Select the dependent/beneficiary to whom the benefit should flow. Any number of payees can be entered, but the total of the Percent of Benefit must be equal to 100%.
Percent of Benefit	Enter the percentage of funds to be distributed to the dependent beneficiary should the payee die. The percentages that you enter must total 100.

Note. To terminate a payee from a provident fund program, add a row and change the status to Inactive.

Note. Additional Provident Fund reports, which are required to be submitted to the statutory bodies, are provided for year-end processing.

See Defining Form 3A Reports.