The Employees’ Provident Fund (EPF) is a retirement savings scheme offered by the Government of India to all salaried employees earning up to INR 21,000 per month. Under the EPF scheme, both the employee and the employer contribute a certain percentage of the employee’s salary to the EPF account. The employee’s contribution is 12% of their salary, and the employer’s contribution is 12% of the employee’s salary, of which 8.33% goes to the EPF account and the remaining 3.67% goes to the Employees’ Pension Scheme (EPS).
The EPF account is a cumulative account, which means that the interest earned on the contributions is compounded annually. This means that the EPF balance grows at a faster rate over time.
The EPF scheme offers a number of benefits to subscribers, including:
- Retirement savings: The EPF account provides a source of retirement savings for subscribers. The money in the EPF account can be withdrawn at the time of retirement or in case of certain emergencies.
- Pension: The EPS provides a pension to subscribers after retirement. The pension amount is calculated based on the subscriber’s contributions and the number of years of service.
- Insurance cover: The EPF scheme also provides insurance cover to subscribers. In case of the subscriber’s death, the nominee receives the balance in the EPF account and a death benefit from the EPS.
EPF Eligibility
To be eligible for the EPF scheme, the employee must meet the following criteria:
- The employee must be a salaried employee earning up to INR 21,000 per month.
- The employee must be working in an establishment that covers under the EPF Act, 1952.
- The employee must be between the ages of 18 and 60 years.
EPF Registration
Employers are required to register their establishment with the Employees’ Provident Fund Organisation (EPFO) if they have 20 or more employees. Once the establishment is registered, the employer must create an EPF account for each employee.
Employees can check their EPF account status online at the EPFO website.
EPF Withdrawal
Subscribers can withdraw money from their EPF account at the time of retirement or in case of certain emergencies, such as unemployment, medical expenses, or purchase of a house.
To withdraw money from the EPF account, subscribers must submit an application to the EPFO. The EPFO will then process the application and release the money to the subscriber’s bank account.
The EPF scheme is a valuable retirement savings scheme for all salaried employees earning up to INR 21,000 per month. The EPF scheme offers a number of benefits to subscribers, including retirement savings, pension, and insurance cover.
Employers are required to register their establishment with the EPFO and create an EPF account for each employee. Employees can check their EPF account status online at the EPFO website.
Subscribers can withdraw money from their EPF account at the time of retirement or in case of certain emergencies. To withdraw money from the EPF account, subscribers must submit an application to the EPFO.
