Employee Provident Fund

Applicability: It is applicable to every establishment which employed 20 or more than 20 workers. However the central Government has the right to apply the act to any establishment where less than 20 workers are employed. However for Co-operative societies the number of employees limits are 50. Once this act is applicable it remains applicable even if the number of employees reduces.

Eligibility (Employee Provident Fund): the employees become eligible to participate in the fund on his joining the establishment covered under this Act. Employees whose basic pay is less than Rs. 7500 p.m. are eligible for participation in fund. Basic pay includes dearness allowance. Where the monthly basic pay of the member was earlier less than Rs. 7500 but now has exceeded Rs. 7500, he will continue to be the member of the fund but his contribution shall be payable on monthly pay of Rs. 7500.

Employee Provident Fund Rates of Contribution:

Employee’s Contribution: 12% of the basic pay of the employee.

Employer’s Contribution:

Provident Fund               3.67%

Family pension Fund      8.33%

Deposit Linked Insurance Fund 0.5%

Employee Provident Fund Administration Charges:

Provident fund              1.1% of total pay

In case of exempted establishment    0.18% of total pay as inspection charges

Deposit Linked Insurance                  0.01% of total pay

*Total Pay means pay of all employees eligible for contribution to provident fund.

Time for payment: it should be deposited on or before 15th of every following month, 20th of every month in case of payment through cheque.

Employee Provident Fund Obligation for Employers:

The employer shall file to the Regional Commissioner a monthly consolidated statement in Form no. 12A by 25th of following month alongwith a triplicate copy of Challans evidencing the payment. And an annual statement in form no. 6 or 6A before 30th april each year.