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June 12, 2018

EPF and ESI


EPF
Applicable on Every establishment which is engaged in any one or more of the business employing 20 or more people. The establishment to which this Act applies shall continue to be governed by this Act, even if the number of employees falls below 20 at a later date.
As per the rules, in EPF, employee whose 'pay' is more than Rs. 15,000 per month at the time of joining, is not eligible and is called non-eligible employee. Employees drawing less than Rs 15000 per month have to mandatorily become members of the EPF. However, an employee who is drawing 'pay' above prescribed limit (at present Rs 15,000) can become a member with permission of Assistant PF Commissioner, if he and his employer agree.
The contribution paid by the employer is 12% of basic wages plus dearness allowance plus retaining allowance. An equal contribution is payable by the employee also. In the case of establishments which employ less than 20 employees or meet certain other conditions, as per the EPFO rules, the contribution rate for both employee and the employer is limited to 10 percent.
Out of employer's contribution, 8.33% will be diverted to Employees' Pension Scheme, but it is calculated on Rs 15,000. So, for every employee with basic pay equal to Rs 15,000 or more, the diversion is Rs 1,250 each month into EPS.  The balance will be retained in the EPF scheme.
EPF reduce women employees' contribution to 8% for first three years of their employment against existing rate of 12% or 10% with no change in employers' contribution.

Due Dates
15th of Next month
Annual Return by 25th Apr

ESIC
Sec 2(12) Non–seasonal Factories using power in and Employing ten (10) or More people.
Non–seasonal and non-power using factories and establishments employing twenty(20) or more people.
Amount of Contribution
1. Employees’ Contribution – 1.75% of the Wages
2. Employers’ Contribution – 4.75% of the Wages
TOTAL 6.5 % of the Wage
Mandatory ceiling for people less than 21 thousand salary.

Due Dates
21st of Next Month
Semi-annual return to be filed by 11th May and 11th Nov

Any individual working in the organization, whether temporary, under probation or permanent, with or without a contract, will be categorized as an employee.
Trainees shall be considered for the purpose of PF, ESI, PT ; until and unless they are Apprentices
Unpaid Interns have nothing to be paid hence nothing to be deducted
Paid Interns ( who undergo the internship in the middle of their curriculum ) need not be considered for PT, ESI or PT


June 5, 2018

Format for Reply of GST Notice




Draft Reply for GST Notices Form 3B and 2A

Draft Reply after confirmation of applicability could include the following points provided:

Date ---------- RPAD/ Speed Post

To:

GST Officer ( issuing notice)
 CC to Commissioner SGST

Dear Sir,

Sub: Reply to ASMT 1 difference in credit in addition to reply online.

We are in receipt of the online mail from mail ID…..Please confirm whether this would be the official ID for further mails and we can reply to this ID.

The period provided of …days is less than the 30 days provided in general for any replies.

The lumpsum figure does not provide the period and the list of credits which have been compared with our figures in 3B. ( We provide our list of credits in Annexure-1)

GST was supposed to be based on voluntary compliance and non invasive. As we understand GSTR 2A is not available or mandatory and therefore comparison with that document may not be fair and in line with GST Act.

It would have been proper to compare the GSTR1 of the supplier and our 3B which could be confirmed.

The reasons for differences could be as under:

1. Delay in availing the credit of earlier months availed in the month under question.

2. Ineligible credits not claimed by us.

3. Reverse charge payments and consequent credits not considered.

4. Import IGST credits similarly not considered.

5. The non-compliance from the supplier's side due to non payment, incorrect uploading, data entry mistake in figures or GST numbers, classifying at B2C instead of B2B and maybe many more which we are still to see are not in our control.

We understand that only in exceptional cases like missing dealer etc, we would be questioned about non-compliance by the supplier and have to prove our compliance.

We have a system of verification of the credits once in a quarter and would be availing the missed credits and reverse the excess credit availed in the subsequent GSTR3B.

Considering all of the above it appears that the notice is too early and may not be legally valid. Please provide us the list of credits as per your record and also confirm that this reconciliation is required in law.

We as law abiding assessees would like to be on the right side of law but do not wish to be burdened with additional costs of preparation of statements, getting them verified by our Consultants if there is no requirement under law.

Kindly acknowledge the receipt of this letter and advise on the questions raised especially concerning the legal validity and the request for information from your side.



Signature of assessee
 Credits to : CA Madhukar Hiregange

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