Employees Provident Fund (EPF) is a scheme controlled by the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It is regulated under the umbrella of Employees’ Provident Fund Organisation (EPFO). PF registration is applicable for all establishment which employs 20 or more persons, subject to certain circumstances and exemptions even if they engage less than 20 employees. Under EPF scheme, an employee has to pay a certain contribution towards the scheme and an equal contribution is paid by the employer. The employee gets a total amount including self and employer’s contribution with interest, on retirement or resignation.
It is obligatory that employees’ drawing less than Rs 15,000 per month, to become members of the EPF. As per the guidelines in EPF, employee, whose ‘basic pay’ is more than Rs. 15,000 per month, at the time of joining, is not requried to make PF contributions. Nevertheless, an employee who is drawing a pay of more than Rs 15,000 can still become a member and make PF contributions, with the consent of the Employer and Assistant PF Commissioner.
The PF contribution paid by the employer is 12% of (basic salary + dearness allowance + retaining allowance). An equal contribution is payable by the employee. In case of establishments which engage less than 20 employees or meet certain other conditions, as per the EPFO rules, the contribution rate for both employee and the employer is restricted to 10%. For most employees working in the private sector, it’s the basic salary on which the contribution is calculated.
Out of employers’ contribution, 8.33% will be routed to Employees’ Pension Scheme, which is calculated at Rs 15,000. The amount routed to EPS would be Rs. 1250 for employees whose basic pay amounts to Rs 15,000 or more. However, if the basic pay is less than Rs 15000, then 8.33% of such amount would be routed to EPS, the balance will be retained in the EPF scheme. On superannuation, the employee would receive the full share plus the balance of employer’s share reserved for his credit in EPF account.
We arrive at the rate of 12% based on the following sub-division:
3.67% of contribution towards Employees’ Provident Fund
1.1% of contribution towards EPF Administration Charges
0.5% of contribution towards Employees’ Deposit Linked Insurance
0.01% of contribution towards EDLI Administration Charges
8.33% of contribution towards Employees’ Pension Scheme
The employer before paying the employees salary must deduct the employee’s contribution from his wages. Then the employee portion and employer portion are payable to the EPFO, within 15 days of the close of every month.
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PF registration for businesses having less than 25 employees.
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PF registration for businesses having less than 40 employees.
all inclusive fees
PF registration for businesses having more than 40 employees.
Employees Provident Fund (EPF) is a scheme controlled by the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It is regulated under the umbrella of Employees’ Provident Fund Organisation (EPFO). PF registration is applicable for all establishment which employs 20 or more persons, subject to certain conditions and exemptions.
PF registration is mandatory for all establishments with 20 or more persons. Some establishments having less than 20 employees would also be required to obtain PF registration. All employee become eligible for a PF right from the commencement of employment and the onus of deduction & payment of PF is with the employer. The 12% rate of PF contribution should be equally divided between the employee and employer. If the establishment houses less than 20 employees, the rate for PF deduction is 10%.
Based on the type of entity seeking PF registration, the list of documents required for PF registration would vary as under:
Last updated: Feb 20, 2021