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Which companies are required to register for EPF (Employees' Provident Fund) in India?

Any establishment employing 20 or more employees is mandatorily required to register under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. Once registered, the obligation continues even if the employee count falls below 20. Voluntary registration is available for establishments with fewer than 20 employees. PF contribution is mandatory for employees with basic salary up to ₹15,000/month; for employees above this threshold, PF contribution is optional but administratively complex.

What are the penalties for late PF payment in India?

Late PF payment triggers penal damages of 5% to 25% per annum on the outstanding amount (depending on the delay period) under Para 32A of the EPF Scheme. Additionally, interest at 12% per annum accrues on the delayed amount. Persistent default can lead to prosecution under Section 14 of the EPF Act, which carries imprisonment of up to 3 years and/or a fine. Directors of the defaulting company can be personally prosecuted.

What is the ESI wage threshold, and which employees are covered?

The ESIC (Employees' State Insurance) scheme covers employees earning a gross salary of up to ₹21,000 per month (₹25,000 for persons with disabilities). Both employer (3.25% of gross wages) and employee (0.75% of gross wages) contribute monthly. ESI covers medical treatment, maternity benefit, disability benefit, and sickness cash benefit. Establishments with 10 or more employees in notified areas are mandatorily required to register under ESIC.

How are the New Labour Codes going to change payroll processing in India?

India's four Labour Codes (Code on Wages, Industrial Relations Code, Code on Social Security, and Occupational Safety Code) restructure payroll significantly – most notably by mandating that the 'basic wage' must be at least 50% of CTC. This increases PF contributions (as PF is calculated on basic), reduces in-hand salary, and requires CTC restructuring for millions of employees. Trade4Asia-listed payroll providers with Labour Code expertise can model the impact on your specific payroll structure and manage the transition compliantly.

Is professional tax applicable in all Indian states?

No – Professional Tax (PT) is a state-level levy and is currently applicable in: Maharashtra, Karnataka, West Bengal, Tamil Nadu, Gujarat, Andhra Pradesh, Telangana, Madhya Pradesh, Kerala, Bihar, Jharkhand, Assam, Meghalaya, Tripura, Odisha, and Sikkim. The rate and slab structure varies by state (maximum ₹2,500/year per employee). Companies with employees in PT-applicable states must register and deduct PT separately for each state.