Employee Provident Fund (EPF)
Employee Provident Fund (EPF) a social benefit scheme for the benefits of employees. The Employee Provident Fund,This scheme is monitored and regulated by
Employees Provident Funds and Miscellaneous Provisions Act, 1952. As per Employees Provident Funds and Miscellaneous Provisions Act, 1952 It is mandatory for every employer to take EPF registration where the number employees are are more than 20.Establishment can take voluntary registration if the number of employees are less than 20.
The PF contribution paid by the employer is 6% 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, its the basic salary on which the contribution is calculated.
Employees contribution as per the Act is 12% of the basic pay to EPF, the employer contribution is 8.33% towards the employee's pension scheme and 3.67% to the EPF itself. Employees also make matching 12% contribution. Along with this, employers also deposit 0.5% for EDLI, 0.65% as EPF administrative charges and 0.01% as EDLI handling fee