Users' questions

What is EPF scheme?

What is EPF scheme?

The Employee Provident Fund (EPF) is a retirement benefits scheme in which employees of an organisation contribute a small portion of their basic pay monthly. In the same line, the employer also contributes a similar amount on their behalf towards the scheme.

Who is eligible for EPF scheme?

EPF is a retirement benefit plan where both employer and employee contribute a certain percentage of the salary. Who is eligible to join EPF scheme? According to the EPF scheme rules, it is mandatory for an employee to join the EPF scheme if his pay is less than or equal to Rs 15,000 a month.

What is EPF and its benefits?

EPFO allows for Partial Fund Withdrawals in certain cases such as medical emergency, home loan repayment, construction or purchase of new house, renovation of house, wedding of children or self. An EPF member can also avail loan in the wake of a financial emergency with a 1 percent rate of interest.

How PF is calculated in salary?

The employee contributes 12 percent of his or her basic salary along with the Dearness Allowance every month to the EPF account. For example: If the basic salary is Rs. 15,000 per month, the employee contribution shall be 12 % of 15000, which comes to Rs 1800/-. This amount is the employee contribution.

Is PF mandatory above 15000?

EPF eligibility criteria If you are drawing a salary higher than Rs. 15,000 per month, you are termed a non-eligible employee and it is not mandatory for you to become a member of the EPF, although you can still register with the consent of your employer and approval from the Assistant PF Commissioner.

Is PF compulsory or optional?

EPF eligibility criteria 15,000 per month, it is mandatory for you to be opened an EPF account by your employer. Organizations with 20 or more employees are required by law to register for the EPF scheme, while those with fewer than 20 employees can also register voluntarily.

How much pension will I get from EPF?

The pension contribution in the EPF passbook is the amount deposited by the employer every month in the EPS account of the employee. It comes to be around ₹ 1250 every month.

What is the new rules of EPF?

The rule requires all PF accounts to be split into separate accounts – one with the taxable contribution and interest earned on that component, and another with the non-taxable contribution that shall include the closing balance of the PF account as on March 31, 2021 and all fresh non-taxable contributions and interest …

How is PF pension calculated?

Earlier, EPFO was providing pension calculated on the salary of the employee with a maximum cap at Rs. 15,000. Now that the cap of Rs. 15,000 has been removed, the EPS contributions will be calculated based at 8.33% of the actual salary of the employee.

What is the difference between EPF and CPF?

EPF means the Employees Provident Fund. A certain portion of this can be used for the medical bills of the employee and even for housing but a certain percentage of this can only be received after the employee has terminated his employment or has retired. The CPF, on the other hand, stands for Central Provident Fund.

What is the difference between EPF and EPs?

EPF stands for Employee Provident Fund while EPS stands for Employee Pension Scheme. Both EPF and EPS work in more or less the same way i.e. they help employees have a retirement corpus when they are no longer earning. The difference however lies in the way they function.

What is the basic difference in EPF/PPF/VPF?

For EPF/VPF, one can apply for a loan and also withdraw their complete investment, whereas, in PPF loans only 50% of the available balance at the end of 4th year can be withdrawn after the onset of the 6th year. In other words, full amount cannot be withdrawn.

What is EPF and ESI?

Just like the ESI scheme, the Employees Provident Fund (EPF) is a Contributory fund with contributions from both the employee and their employers. While the focus of the ESI scheme is healthcare, Provident Fund is focused towards post Retirement Income and Benefits. Sep 25 2019