Find out what happens to the employer’s contribution towards your PF account


Fortunate asset (PF) commitment addresses detached investment funds for a salaried representative. For most representatives, 12% of the fundamental compensation goes into the PF account every month. An equivalent rate is likewise contributed by the business. Notwithstanding, by and large, not the whole 24% of PF commitments lands up in the representatives’ fortunate asset account (EPF) every month.

On the off chance that you check out your PF explanation or the PF passbook, you will discover separate sections for representatives’ and manager’s commitments towards the PF account. Also, there is another section that shows commitment towards representatives annuity conspire (EPS). Both EPF and EPS are under the domain of the Employees’ Provident Fund Organization (EPFO).

EPF is just a single piece of the worker’s general retirement corpus while EPS is the other part.

The representative need not contribute towards EPS however out of the business’ commitment, a specific rate is redirected towards EPS. With essential compensation (for benefits purposes) covered at Rs 15,000, 8.33 percent of the compensation is redirected or placed into EPS. This implies, regardless of a higher fundamental compensation (above Rs 15,000), every month Rs 1250 of the boss’ commitment is placed into EPS.

The measure of month-to-month benefits relies upon the number of long periods of administration and a decent recipe. On retirement, after a base time of ten years of administration, the base benefits each month is fixed at Rs 1,000 while the greatest month-to-month annuity sum is Rs 7,500. To guarantee that one gets the kudos for the quantity of years worked, try to select ‘plot testament’ which helps EPFO track your administration period.

The working of EPS isn’t like EPF and neither do EPS commitments procure any interest. Whatever goes into the EPS, the whole corpus stays with the public authority and the representative beginnings getting benefits after retirement. At the point when a worker changes occupations, EPF gets moved with the new business, albeit the UAN stays as before. Be that as it may, after the work change, EPS commitment stays with EPFO. The worker has the choice to either pull out EPS assets or convey forward to the following position. This nonetheless, relies upon the length of administration and age of the representative.

In the event that a representative has not finished ten years of constant assistance, he can either pull out the EPS sum, or take the ‘plot endorsement’. On joining the new business, present the plan testament to EPFO through the new boss. When ten years are finished, the withdrawal advantage stops and one can just take the plan declaration from EPFO by documenting a similar Form 10C.

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