Employers Provident Fund (EPF) is a scheme controlled by the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It is stated under this act that the companies employing a staff of more than 20 persons requires to obtain PF registration. Those having less than 20 persons can voluntarily obtain the same.
For PF, the employer and the employee contribute 6% of (basic salary + dearness allowance + retaining allowance). In the 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.
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 required 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.
Important Aspects Of PF Registration
Provident fund return is required to be filed by all entities having PF registration at the end of each month. PF return is due on the 25th of each month. Further, a final PF return is due on the 25th of April for the year ended on 31st March.
Unified Portal & UAN
In order to improve the ease of doing business, all services relating to PF are made available online through a Unifies Portal. Employees who have the newly allotted UAN can use the Unified Portal for various services.
Provident Fund (PF) payments are due on the 15th of each month. The employer must deposit a total of 12% or 10% of the employee wages towards PF on or before this date every month. For most entities, the PF rate of 12% would be applicable.
Employees who have contributed to PF can withdraw money from their PF account for various reasons such as house purchase, medical reasons, marriage or eductaion etc by applying on the Unified Portal.