The government last increased the wage ceiling limit in 2014. Then it was increased from Rs 65000 to Rs 15,000. If the government increases the wage ceiling limit, then the contribution of the employee and employer in retirement and pension savings will increase.

Contribution to EPS will increase every month

Experts say that increasing the wage ceiling limit will increase the contribution to EPS . This will increase the pension received by the employee after retirement. Every month, the employee and the employer have to contribute equal amount in EPF. 12% of the employee’s basic salary is deposited in EPF. The employer also contributes 12% of the basic salary. Out of this 12%, 8.33% is deposited in the EPS account. The rest is deposited in the EPF account.

Calculation based on wage ceiling limit of Rs 15,000

Currently, 8.33 percent of Rs 15,000 is deposited in the employee’s pension account (EPS) every month. When the wage ceiling limit increases to Rs 21,000, 8.33 percent of this amount will be deposited in his EPS account. This means that Rs 1,749 will be deposited in the employee’s EPS account every month. Currently, 8.33 percent of Rs 15,000, i.e. Rs 1,250 is deposited in the employee’s EPS account every month.

Out of the employer’s 12% contribution, 8.33% goes to EPS

Experts say that if the government increases the wage ceiling limit, then the pension amount of the employee will increase. The reason for this is that after retirement, the employee gets the entire amount deposited in EPF in lump sum. But, he gets pension every month on the money deposited in EPS. By increasing the wage ceiling limit, more money will be deposited in his EPS account every month.

Change in wage ceiling limit 10 years ago

This will result in a good amount of money being deposited in his EPS account till retirement. This will also increase his pension every month. Experts say that the government had revised the wage ceiling limit 10 years ago. Meanwhile, inflation and income have increased. Therefore, the government should make changes in it.

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The post PF contribution: Govt can increase the contribution limit of EPF, EPS to Rs 21000, Details Here first appeared on Rightsofemployees.com.

This claim has been made in a report published in Financial Express quoting Labor Minister Mansukh Mandaviya. Currently, the money which is deposited in EPFO ​​and EPS every month from the salary of the employees, after this that limit is expected to be increased. Currently, there is a limit of Rs 15000 under the Employees Provident Fund.

More money will be deposited in EPFO ​​and EPS

Earlier this limit was Rs 6500, which was last increased to Rs 15000 in the year 2014. There has been no change in it since then. Now the government is considering increasing this limit to Rs 21000. This simply means that employees will be able to deposit more money in EPFO ​​and EPS than before. After the new rule is implemented, crores of salaried class will get its benefit. This will also affect the pension received by employees after retirement.

How does EPFO ​​rule work now?

Currently, if an employee’s monthly salary is Rs 15,000 or more, then the employee and the employer have to deposit 12% each in EPF. But the employer’s money is divided into two parts. Out of this, 8.33% goes to EPS (Employees Pension Scheme) and the remaining 3.67% is deposited in EPF. In such a situation, an employee with a salary of Rs 15,000 will have to deposit 12% i.e. Rs 1800 in the EPF account every month. Apart from this, your company will also deposit 12% of the salary i.e. Rs 1800. But this money will be divided into two parts, EPF and EPS. Out of this, Rs 1250 goes to EPS and the remaining Rs 550 goes to EPF.

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What will be the new EPFO ​​limit?

If the government increases the limit to be deposited in EPF from Rs 15,000 to Rs 21,000, then the calculation will also change. On a salary of Rs 21,000, Rs 2,520 will be deducted as PF every month at the rate of 12 percent. Apart from this, out of the same contribution given by the company, Rs 771 will be deposited in the EPF account and the remaining Rs 1,749 will be deposited in the EPS account.

What will be the benefit of increasing the wage ceiling?

If an employee starts depositing money in EPF at the age of 23 and continues to do so for 35 years, then on a basic salary of Rs 15,000, he will get a total of Rs 71.55 lakh at the time of retirement. Out of this, Rs 60.84 lakh will be only interest. While the amount deposited by him is Rs 10.71 lakh. This calculation is based on an annual interest of 8.25%. But if the government increases the limit of money deposited in EPF from Rs 15,000 to Rs 21,000, then that employee will get a total of one crore rupees. Out of this, Rs 15 lakh will be deposited by the employee and the remaining Rs 85 lakh will be interest. That is, the concerned employee will get Rs 28.45 lakh more than before.

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The post PF Contribution: Govt plans to raise EPFO wage ceiling 15000 to 21000 – You will get the full benefit of Rs 28 lakh first appeared on Rightsofemployees.com.

Employees’ Provident Fund Organization (EPFO) data shows that Byju’s has made PF payments of Rs 14.6 lakh in the name of 738 employees for June. While the company has again delayed depositing the PF of a large number of employees. In a mail sent to EPFO ​​on June 27, Byju’s had said that the company has settled the PF payment till May. The company had agreed to pay the June PF by July 15.

Byju’s had released PF payments for 24,818 employees on June 26, after last month’s tussle over delay in PF payments. Earlier, Byju’s did not make PF contribution for April and May, while for January, February and March the company paid PF for only 10,000-13,000 employees.

According to many industry experts, Byju’s delay in PF payment may be an indication of cash flow pressure in the company. The edtech firm, which was last valued at $22 billion, has cut costs and vacated some offices. Byju’s vacated its largest office space in the country amid long-pending funding round and talks with lenders on its existing debt obligations.

Byju’s has already officially laid off more than 2,000 employees. While most of its workforce has been done on contract. According to EFPO data, in September 2022, Byju’s had around 60,000 employees on its payroll.

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TDS will not be deducted if withdrawn after five years. TDS will be deducted on the entire amount withdrawn from the PF account before five years. Not only this, PF contribution of more than Rs 2.50 lakh in a year will come under tax net.

An important change has been made regarding TDS in the budget. If you withdraw money from your PF account after April 1, 2023, now you will have to pay TDS at 20% instead of 30%. Whether your account is linked to PAN card or not. If you withdraw from EPF before 1 April 2023, you will have to pay TDS as before.

TDS is not applicable after 5 years.

If an account holder withdraws money within 5 years, he has to pay TDS. At the same time, no TDS will be levied on withdrawal of money after 5 years. Finance Minister Nirmala Sitharaman had informed in the budget that the limit of Rs 10,000 for TDS has also been removed.

Understand the new rule like this According to media report, tax expert Balwant Jain says that if PAN is not linked to Aadhaar, then PF withdrawal tax will have to be paid if the withdrawal is made before five years of opening the PF or EPF account. If the PF account is linked to the PAN card of the account holder, no TDS will be levied on the withdrawal amount. The amount that will be withdrawn from PF will be added to the total taxable income of the account holder for that year and will be taxed as per the income tax slab of the PF account holder.

Balwant Jain says that if the PF account is not linked to the PAN card of the account holder, then TDS is deducted on the net amount available in his PF account. Currently the TDS rate is 30 percent, which will be reduced to 20 percent from April 1, 2023.

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New Delhi. EPFO Rules: If you are also a member of Employees’ Provident Fund Organization (EPFO), then this news is of great use to you. You must have heard about the Employees Deposit Linked Insurance (EDLI) scheme. Subscribers get free insurance up to Rs 7 lakh under this scheme. The purpose of this scheme is to provide financial security to the family member after the death of the PF account holder.

As for the benefits available under this scheme, EPFO ​​has made it clear that all those account holders of Provident Fund (PF) or Employees’ Provident Fund (EPF) are eligible for benefits under the Employees’ Deposit Linked Insurance (EDLI) scheme when they die. are on leave without pay (LWP).

Let us know the rules

EPFO ​​has said that if an account holder is on leave without pay (LWP) on the day of death and his monthly EPF or PF contribution is not coming in his provident fund account, he is still entitled to the benefit of this scheme. Just the EPFO ​​member needs to be in muster roll on the day of death and fulfill other conditions to claim the assured benefit.

While issuing a notification in this regard, the EPFO ​​said, “If a staff member was on leave without pay (resulting in no contribution being payable by the employer) or was absent for any other reason and died during the period, then Assurance benefit is admissible given the fact that no contribution was paid by the employer, provided he was in the muster roll of the company on the day of his death and satisfied the prescribed conditions.”

Employee does not get benefit EPFO ​​further said that many complaints have been received in this regard. Some offices are rejecting the claims saying that the PF contribution was not received during the last few days and hence EDLI benefit will not be available.

Verification to be done within 7 days While directing establishments not to harass the family members of the deceased PF account holder, the EPFO ​​said that proper verification should be done within 7 days and the family members should not be harassed.

The post EPFO Rules: Now even having LWP, you will get the benefit of 7 lakhs, know what are the rules first appeared on Rightsofemployees.com.