Despite the EPFO declaring an 8.5% interest rate for FY20, these EPFs offer yields ranging from 4.5% to 6.6% and have exempted PF trusts to match. Experts proposed transferring risk to subscribers rather than provident funds as a remedy to this mismatch through unitisation.
Employees’ Provident Fund (EPF) is one of India’s most popular investing choices. Both the employer and the employee pay 12% of the employee’s basic salary to the fund in order to build a corpus for the future.
In general, the employee contribution rate is set at 12 percent. However, the rate is set at 10% for the organizations listed below:
The minimum amount of contribution that the employer must make is fixed at 12 percent of Rs. 15,000 (although they can voluntarily contribute more). This equates to Rs. 1,800 each month. This means that both the employer and the employee must contribute Rs. 1,800 each month to this plan. Initially, this sum was fixed at 12 percent of Rs. 6,500, which equated to Rs. 780 in contributions from both the employer and the employee.
Both parties’ contributions are deposited in the EPFO (Employees Provident Fund Organisation).
This is a long-term investment fund for participants that enables them to live independently after retirement.
EPF Contributions: |
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EPS Contributions: |
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EDLI Contribution: |
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Q1. What are the procedures for recovering the PF payment from a defaulting employer?
Receipt of debts from debtors, Employer Arrest and Detention Prosecution under Section 14 of the EPF and MP Act of 1952, attachment of bank accounts, attachment and sale of properties, action under Sections 406/409 of the Indian Penal Code and Section 110 of the Criminal Procedure Code
Q2. Is it legal for companies to deduct their portion of contributions from their workers’ wages?
No, employers are not permitted to deduct their portion of contributions from employee pay. It is a criminal offense to make such a deduction.
Q3. Can an employee contribute to EPF after leaving the company?
No, the employee cannot contribute to EPF unless both the member’s and the employer’s contributions are matched.
Q4. How can I figure out what my employer’s EPF contribution is?
– If you are a guy, you must donate 10% or 12% of your basic wage.
– If you are a new female employee, it is 8% of your base pay for the first three years. Following that, it will be 10% or 12% of your base pay.
– EPF contributions must be made by your employer in the amount of 10% or 12% of your basic pay.
Q5. Who should an employee contact if he or she is denied PF membership?
If his or her company fails to offer membership, the employee may contact the Regional Provident Fund Commissioner at the local PF office.
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