Employees’ Provident Fund
EPF is a welfare scheme brought into force to secure a better future for employees. It is a statutory benefit available to the employees post retirement or when they leave the services. In case of deceased employees, their dependents will be entitled for the benefits. Under the Employees’ Provident Fund Scheme (EPF Scheme) both employers and employees have to make their contributions towards the Fund. Interest earned on the amount is credited to the member’s Provident Fund Account (PF account) and is available to the employee at the time of retirement or exit from employment as the case may be, provided certain conditions are fulfilled.
Applicability
Employees’ Provident Fund has been set up under The Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (“Act”) applicable pan-India. The Act is applicable to every factory or industry mentioned in Schedule 1 of the Act, wherein 20 or more persons are employed or to any other establishment which the Central Government specifies by notification in the official Gazette, even when the number of employees is less than 20.
Eligibility to be the member of EPF
Enrollment for PF membership is mandatory for:
Any person employed for wages for any work of an establishment either manual or otherwise.
Any person employed through a contractor or engaged as an apprentice but not being an apprentice under Apprentices Act, 1961.
Any person under the standing orders of an establishment, earning less than or equal to Rs. 15,000 per month other than the excluded and exempted employees under Section 17 of the Act.
Benefits
The employees covered under the various schemes of the Act are entitled for the following benefits
Employees can take advances or make withdrawals*.
PF amount of a deceased member is payable to the nominees or legal heirs.
The employer not only contributes towards the PF but also makes the necessary contributions towards the employee’s pension which can be used by the employee post-retirement
Under the EDLI Scheme employees are properly insured in order to avail the lump sum benefit at the time of death while in service.
EEE (Exempt, Exempt, Exempt) tax benefit under the Income Tax Act enables tax-free returns for the employees.
Employees receive special benefits in the form of added income to their savings in the form of interest.
PF account can be transferrable if any member changes employment from one establishment to another where such Provident Fund scheme is applicable.
EPF is a welfare scheme brought into force to secure a better future for employees. It is a statutory benefit available to the employees post retirement or when they leave the services. In case of deceased employees, their dependents will be entitled for the benefits. Under the Employees’ Provident Fund Scheme (EPF Scheme) both employers and employees have to make their contributions towards the Fund. Interest earned on the amount is credited to the member’s Provident Fund Account (PF account) and is available to the employee at the time of retirement or exit from employment as the case may be, provided certain conditions are fulfilled.