EPFO Update: EPFO is one of the world’s largest social security organisations in terms of the volume of financial transactions undertaken and clientele. According to the Annual Report 2015-16, EPFO currently maintains 17.14 crore accounts pertaining to its members. It provides Universal Social Security Coverage on a mandatory basis by way of Provident Fund, Pension and Life Insurance for all workers of the country. There are many ambiguities related to EPFO’s functioning, the contribution of employers and the employees and EPFO interest rates which are discussed in the other half of the article.
Recently, EPFO has shared a tweet asking concerned group of people to stay connected for updates. EPFO Tweeted, “Stay connected with #epfo through our social media platforms and get updates on #pf #pension and #EDLI #AmritMahotsav @PMOIndia @byadavbjp @Rameswar_Teli @LabourMinistry @mygovindia @PIB_India @MIB_India @AmritMahotsav @_DigitalIndia.”
Tweet from EPFO’s Twitter handle
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About EPFO scheme
EPF, or Employee’s Provident Fund, is a retirement benefit programme accessible to all salaried workers. The Employees Provident Fund Organization of India is in charge of caring for and maintaining it (EPFO). Any registered business with more than 20 employees is required by law to register with the EPFO.
The Employee’s Provident Fund is available to all salaried employees (EPF). However, it is required that paid employees who make less than Rs 15,000 per month open an EPF account. Any registered business with more than 20 employees is required by law to register with the EPFO. If a person earns more than Rs 15,000 per month in salary, they are considered non-eligible employees and are not required to join the EPF, however they can still enrol. Companies with fewer than 20 employees may voluntarily register as well. For EPF registration, one must provide both the firm’s information and the information on the owners of the company. You can register for the EPF programme on the official website.
What do employees and employers contribute to the EPF?
In accordance with the EPF plan, contributions from both the employer and the employee are equal. When an employee retires, they receive a lump sum payment with interest that includes both their own and the employer’s contributions. A total of 12% of the employee’s base pay is contributed by both the company and the employee.
While the employee’s entire 12% contribution goes into their EPF account, 8.33% of the employer’s 12% contribution is instead sent to the employee’s EPS (Employee’s Pension Scheme) account. 3.67 percent of the employer’s balance is deposited into the employee’s EPF account.
What are the EPFO Interest Rates?
The annual interest rate on EPF is currently 8.55 percent for the fiscal year 2017–18, compared to 8.65 percent for the fiscal year 2016–2017, according to the official EPF India website. Every year, for a financial year, the Central Board of Trustees of the EPFO examines the interest rate of the EPF in cooperation with the Ministry of Finance. EPF interest rates increased to 8.65 percent in advance of the 2019 elections. The idea still needs to receive approval from the CBT, following which the finance ministry must agree.
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EDLI or Employees Deposit Linked Insurance Scheme
Employees Deposit Linked Insurance Scheme, sometimes known as EDLI, is an insurance programme offered to salaried workers in the private sector by the EPFO (Employees Provident Fund Organization). When the insured individual passes away during the service period, the registered nominee is given a lump sum payment. All organisations that are registered under the Employees Provident Fund and Miscellaneous Provisions Act, 1952, must comply with EDLI. All of these businesses are required to participate in this programme and provide life insurance coverage to their staff members. This programme functions in conjunction with EPS and EPF. The employee’s most recent salary is used to determine the benefit’s size.
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