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The provisions of Employee’s Provident Fund (EPF) is governed by The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (PF Act). It aims to mobilise the savings of the employees and employer through compulsory contributions to the provident fund.
The PF Fund is administered and managed by The Employees’ Provident Fund Organisation (EPFO) and assists Central board of Trustees, EPF is a statutory body formed by the PF Act.
Union Budget 2021 Outcome:
In case the employee’s PF contribution was deducted but not deposited by the employer, it will not be allowed as a deduction for the employe with effect from A.Y. 2021-22
The government has decided to retain the EPF interest rate of 8.5% for the financial year 2020-21.
Employee Provident Fund Scheme is one of the most useful employee beneficial scheme introduced by Ministry of Labour. It is one of the ideal retirement fund. It is a type of savings account where both employer and employee contributes an equal amount at regular intervals. Such contribution can be made only by those employers who are registered and employees of registered employers. Employer registration can be either through statute mandate or voluntary.
As per the PF Act, every company/organisation employing more than 20 individuals, including employees who are on contract, is mandatorily required to register under PF Act.
Once the PF Act is applicable, the employer’s organisation continues to be governed by the PF Act even if the number of employees falls below 20 at any time.
Further, it is not mandatorily apply to all employees of registered establishment. Only such employees earning up to Rs. 15,000 are eligible to be covered under the PF Act and can make contribution. Both employer and employee who are not mandated by PF Act, can voluntarily register and contribute for PF.
Though contribution to PF account is made both by employer and employee, payment is to be made to PF account by employer who is registered with PF Act.
From September 2015 it is mandatory for all establishments to pay PF online. Online PF payment can be made by the employer either on EPFO website or through authorised bank website (if bank allows direct payment through their website) in which employer has an account and net banking.
Presently EPFO has tie up arrangement with 10 banks to collect EPFO dues and banks are SBI, PNB, Indian Bank, Bank of Baroda, HDFC Bank, ICICI Bank, Axis Bank and Kotak Mahindra Bank.
Along with the list of authorised banks, we have also provided links for specific payment procedure for few banks published on their website:
Calculate your total corpus in EPF account through PF tax calculator