PF Registration

For every business with more than 20 employees, it is mandatory to have a Provident Fund registration. Every employee is eligible for registration under EPF at the time of joining itself. The law mandates that an employee who draws monthly salary below INR 15,000 must be registered under EPFO (Employee Provident Fund Organization). Employee drawing more than 15,000 per month can also participate in this scheme with the prior consent of the employer. The government devised this scheme under Employees Provident Funds and Miscellaneous Provisions Act, 1952 to secure the future of employees, especially working in the Private Sector.

Under this scheme, every employee must contribute 12% of their monthly salary, and his/her employee will contribute the same amount. As per the law, if the number of employees is less than 20, the contribution should be 10% for employer and employee. The amount of contribution is calculated on the basic salary of the employee. Specific interest will be given on the amount deposited under the EPF scheme. This rate of interest will be subjected to change as per the government’s law.

The government implemented the scheme of Employee’s Pension Scheme to ensure the financial independence of a person after retirement. When an employee leaves the job, all the funds, except the contribution made towards the Employee’s Pension Scheme can be withdrawn by him/her. The contribution made towards the EPS (Employee’s Pension Scheme) can be availed only after the retirement barring some exceptional circumstances.