Introduction :
PF stands for Provident Fund. It is a scheme for salaried employee to make investments in the course of paintings existence and revel in the advantages after retirement. It is a compulsory, government-controlled retirement financial savings approach for personnel, who can make contributions part of their financial savings in the direction of their pension fund, each month. The whole technique is monitored through EPFO (Employees Provident Fund Organisation). Any employer that has greater than 20 employee is entitled to PF and have to sign in with the EPFO.
This Act may be called the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. The worker and enterprise every make contributions 12% of the worker`s simple income and dearness allowance in the direction of EPF. All the guidelines and policies are described through the Employee Provident Fund Organisation. The EPFO`s sports are controlled through the Ministry of Labour and Employment.
All subscribers of EPF can get right of entry to their PF money owed on line and carry out features like withdrawal and checking EPF balance. The Universal Account Number (UAN) makes it handy to login to the EPFO member portal.
Given below are the various schemes that are present under the EPFO:
1. Employees’ Provident Funds Scheme 1952 (EPF)
2. Employees’ Pension Scheme 1995 (EPS)
3. Employees’ Deposit Linked Insurance Scheme 1976 (EDLI)
One of the many schemes run by EPFO is Employees Deposit Linked Insurance Scheme ie EDLI Scheme. EPFO members get the benefit of insurance through this scheme.
EPFO gives the benefit of insurance cover to the family of its members in case of accidental death. Under the EDLI scheme of EPFO, in case of premature death of the subscriber, his nominee is given an insurance amount of up to Rs 7 lakh. If a person is a member of EPFO and has worked for 12 consecutive months, then in case of premature death, his family members will be given the benefit of insurance cover of Rs 7 lakh.
This insurance cover is also available to those people who have worked in more than one organization within a year. Insurance can be claimed on behalf of the family members of the employee in case of premature death of the employee. The claiming member in the EDLI scheme should be the nominee of the employee. Let us tell you that even after death due to corona, the benefit of this insurance cover is available.
Would not have given any money
To take advantage of insurance under the EDLI scheme of EPFO, you do not have to pay any money separately as premium. Contribution to this scheme is made by the employer ie the organization where you are working.
How to claim
In case of premature death of EPFO member, his nominee or successor can claim for this insurance cover. In order to make a claim, the insurance company is required to provide the death certificate of the employee, succession certificate, certificate of the guardian applying on behalf of the minor nominee and bank details.
EPF Contribution:
EPF Eligibility :
The eligibility criteria in order to join the EPF scheme are mentioned below:
1. It is mandatory for salaried employees with an income of less than Rs.15,000 per month to register for an EPF account.
2. As per law, it is mandatory for organizations to register for the EPF scheme if they have more than 20 employees working for them.
3. Organizations with less than 20 employees can also join the EPF scheme on a voluntary basis.Sec. 1(4)
4. Employees who earn more than Rs.15,000 can also register for an EPF account; however, they must get approval from the Assistant PF Commissioner.
PF Payment and Return due date :
Employers need to deduct PF from the employee salary on or before 15th of every next month. While the due date of PF return and the due date of PF payment are both the same. The EPF payment can be made later by the employer at his convenience after filing the ECR.
Late Payment Interest and Penalty :
In case of delay of PF challan payment the following Interest and Penalty are Applicable :
∆ Interest for Late Payment :
Under section 7Q The employer shall be liable to pay an interest of 12% per annum, from the date on which the amount has become so due till the date of its actual payment.
∆ Penalty for late payment :
Under Section 14B, the following penalties need to be incurred in case of failure of EPF Challan payment.
1) 5% interest p.a for a delay of upto 2 months
2) 10% interest p.a for a delay of 2-4 months
3) 15% interest p.a for a delay of 4-6 months
4) 25 interest p.a for a delay of more than 6 months
PF Annual Filing Due Date:
The due date for PF Annual filing is the 30th of April every year. By 30th April of every year, the annual returns for PF must be filed. This must be carried out through filing Form 3A and Form 6A. This is an electronic monthly return to be uploaded by the employers through the Employer e-Sewa portal. The return will have the member wise details of the wages and contributions including basic details for the new and exiting members.
When can we withdraw the EPF amount? EPF can be completely withdrawn in case if employee retires or remains unemployed for 2 months or more.
Note:
1. Its needed to mention that fact that the individual is unemployed for more than 2 months, the same has to be certified by gazetted officer.
2. Decision taken at the 22nd central board of trustees meeting of EPFO in June 2018, it was decided that subscribers of Employees Provident Fund Organization (EPFO) who resign from their service can now withdraw 75% of their total provident fund kitty after one month from the date of cessation of service to meet their monthly financial commitments.
3. One is also allowed to withdraw the EPS amount if the service period has been less than 10 years and not later on. Once this milestone is crossed, the employee compulsorily gets pension benefits after retirement.
Pension Withdrawal process and Calculation:
4. Following are different scenarios when and how much amount can be withdrawn from EPF
Types of EPF Forms :
The table below gives the list of different EPF forms and their uses:
v EPF Joint Declaration Form :
An EPF joint declaration form is a form signed by you, as an employee and your employer and the EPF joint declaration form is secure for correction of date of birth in your PF account, date of joining, name in UAN, your father’s name, and also the date of exit.
v Auto Transfer of Accounts :
Ref: Head Office Circular no. Manual/Amendment/2011/13326 dated 20 Sept 2017
With reference to above circular, it is to inform that the necessary functionality required to carry out Auto Transfer of Accounts of a member on change of employment has been launched in Unified Portal/ EPFO Application Software.
Auto transfer of PF account on change of job: Rules, procedure you need to know
In a circular to all its regional offices, the retirement fund body said any EPFO member seeking auto transfer of his/her PF account needs to submit details, such as "date of joining, date of exit and reason for the exit" from the previous employment
The Aadhaar number of the member must have been seeded and verified against the UAN at the previous establishment level.
Auto transfer of provident fund while changing jobs will be initiated only after the first payment of the new employment is received against the UAN flagged for such transfer, the Employees Provident Fund Organisation (EPFO) has said
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