Latest

Related Posts

2024 EPF Interest Rates: Everything You Need to Know

The Employee Provident Fund (EPFO) in India allows corporate employees to accumulate a pension fund, overseen by the EPFO organization.

- Advertisement -

2024 EPF Interest Rates: In India, employees in corporate settings have the opportunity to accumulate a pension fund through the Employee Provident Fund, or EPF. More people refer to the EPF as just PF or Provident Fund. The EPFO is the organization in charge of overseeing all operations.

Interest rate on EPF in 2024

For the fiscal year 2023–2024, the central board of the Employees Provident Fund Organization (EPFO) suggested today that members’ accounts containing EPF accumulations receive an annual rate of interest of 8.25%. Compared to the 8.15% interest rate for FY23, the interest rate for EPF contributions in FY24 is 10 basis points higher.

- Advertisement -

Keep in mind that the EPFO changes the PF interest rate once a year. The rate is good for the following fiscal year after the EPFO releases the new interest rates on EPF deposits. This indicates that the new rate will be in effect from April 1 of one year to March 31 of the next year.

EPF deposits have a fixed interest rate ranging from 8% to 13% annually. EPF credits the interest on deposits annually to your account, but it can calculate it monthly. For instance, if the EPF rate is 8.1%, it calculates your monthly EPF deposit interest as 8%.

The EPFO paid 8% interest on EPF contributions between 1977 and 1970. Interest on PF contributions has been at least 8.25% ever since. Sixty million EPFO users will be impacted by the government’s decision.

Finance Minister Nirmala Sitharaman stated that reality set the interest rate on the Employee Provident Fund (EPF), and the return rate on other modest savings instruments was even lower than the EPF rate. The fact that these are the current rates and that EPFO is still more than the others does not change, she added. “There are today’s realities, which do keep us in the context of decisions taken by the central board of EPFO.”

What is EPFO?

The Labour Ministry is in charge of the EPFO, which was established in 1951. The Employees’ Provident Fund Organization is known by its abbreviation, EPFO. Employees in India’s private and public sectors can save money for retirement with the aid of the EPFO.

Every EPF member is given a Universal Account Number (UAN) by the EPFO, which serves as the member’s unique identifier for all PF-related transactions.

EPF Claim Status: Review the entire process here

EPF: What is it?

The Employees’ Provident Funds and Miscellaneous Provisions Act of 1952 designates the EPF as its primary program. The EPFO requires all businesses with 20 or more employees to register and provide their staff with the benefits of the EPF plan. In some cases, businesses must comply even if they employ fewer than 20 individuals.

PF: What is it?

It is sometimes known as EPF, a government-managed pension plan designed to assist Indian salaried workers in saving money for their retirement.

PF Full form

The Employee Provident Fund, or EPF for short, is a retirement savings plan that pays out a lump sum to all salaried workers.

PF Qualifications

All employees who were paid up to Rs 15,000 per month when they started employment are required to enroll in the EPF plan. An employee may also enroll in the EPF plan with the assistant PF commissioner’s approval if their monthly pay exceeds Rs 15, 000.

EPF: Contributions from employers and employees

Both the company and the worker contribute twelve percent of the worker’s base pay and dearness allowance to the Employee Provident Fund (EPF). While employees have the option to increase their contributions to the EPF, employers are not obligated to do so.

EPF contribution

Contributor Monthly percentage of salary plus dearness allowance
Employer 12%
Employee 12% or 10%*
Total 24% or 22%*

Be aware that the 12% match from your company is divided among many baskets. Only 3.67% of this contribution goes into the EPF account; the remaining 8.33% goes into the Employee’s Pension Scheme, or EPS account. On the other hand, the employee’s whole contribution is deposited into the EPF account.

Women EPF contribution

In Budget 2018, the government lowered the contribution for female employees to 8% for the first three years of their employment, depending on the kind of company, to empower women.

Salary components for the purpose of EPF contribution calculation

  • Basic salary
  • Dearness allowance
  • Retaining allowance
  • Conveyance allowance
  • Other allowance
  • Special allowance
  • Leave travel allowance
  • Fixed cash allowance, including management allowance, educational allowance, medical allowance, telephone allowance & food allowance
  • Petrol reimbursement
  • Compensatory allowance

Salary components excluded from EPF contribution calculation

  • House rent allowance (HRA)
  • Attendance allowance
  • Night shift allowance
  • Washing allowance
  • Relocation allowance
  • Overtime allowance
  • Canteen allowance
  • Special benefits
  • Bonus
  • Commissions

Are you able to increase your EPF contribution?

Yes, you can use the Voluntary Provident Fund (VPF) to make larger contributions to your EPF account.

EPF computation

Basic pay, dearness allowance, and retaining allowance are taken into account while calculating EPF contributions. Employees receive interest on these payments as well as a lump sum payment upon retirement.

Example of EPF calculation

Let’s say your base pay is Rs 50,000 + dearness allowance. You will make a Rs 6,000 payment to your EPF account. Employers can choose to contribute more voluntarily, however the least amount they must deposit to their EPF account is 12% of Rs 15,000. Your employer may contribute to your EPF account using any combination of the following methods:

Method Employee contribution Employer contribution
1 12% of basic salary plus DA 12% of basic pay
2 12% of basic salary plus DA 3.67% of basic pay
3 12% of Rs 15,000 3.67% of Rs 15,000

Note: Of the Rs 15,000 in your EPS account, the employer can only contribute 8.33%. This means that even if your base pay is Rs 50,000, his contribution to your EPS account cannot exceed Rs 1,249 (8.33% of Rs 15,000.

For the purpose of PF computation, we will deposit your and your employee’s contributions based on a breakdown of Rs 50,000 as your pay.

Your share: Rs 6,000, or 12% of Rs 50,000

The employer’s portion is Rs 1,835 (3.67% of Rs 50,000).

Employer’s share of EPS is 8.33% of Rs. 15,000, or Rs. 1,250.

The employer transfers the remaining cash to your EPF account because they are unable to deposit more than 8.33% of your Rs 15,000 in your EPS account.

Hence, the EPF account’s total balance is equal to Rs 6,000 + Rs 1,835 + Rs 2,915 = Rs 10,750.

EPF account following a change in employment

When moving jobs, employees do not need to apply for the transfer of their EPF accounts. The new employer may request information regarding the employee’s EPF account in order to contribute to the account. If you don’t, the employer will issue you a new member ID and create a new account.

Tax on the quantity of PF

The income tax laws exempt interest generated on funds in your personal savings account. This indicates that subject to a few restrictions, the full corpus is free from taxes at the time of maturity. In actuality, an employee may deduct expenses under Section 80C about the contributions paid to their EPF account.

EPF disengagement

Employees can choose to increase their contributions to the EPF, but employers are not required to do so. For information on the terms and conditions, see our guide on EPF withdrawals.

EPFO updates

The TDS rate on PF withdrawal for cases other than PAN is 20%.

  • The 2023-24 Budget includes a reduction in tax deducted on EPF withdrawals from 30% to 20% for PF account holders who fail to provide their PAN.

Net new EPFO enrollments hit a record 12.2 million in FY22

Finance Minister Nirmala Sitharaman stated, “Reducing the TDS rate from 30% to 20% on the taxable portion of EPF withdrawal in non-PAN cases,” in her February 1, 2023, budget speech.

Muskan Manocha
Muskan Manochahttps://www.eduvast.com
Muskan Manocha is pursuing graduation from University of Delhi.

Popular Articles

We use cookies to personalise content and ads, to provide social media features and to analyse our traffic. We also share information about your use of our site with our social media, advertising and analytics partners. View more
Cookies settings
Accept
Privacy & Cookie policy
Privacy & Cookies policy
Cookie name Active
PRIVACY POLICY
  1. General
  • (1.1.) Eduvast (“Eduvast”, “We”, “Our”, “Us”) is committed to the protection of personal information provided by the users (“You”,“Your”,“User”) to Eduvast. You agree that Your use of Eduvast implies Your consent to the collection, retention and use of Your personal information in accordance with the terms of this Privacy Policy (“Privacy Policy”).
  • (1.2.) We take the privacy of our Users seriously. We are committed to safeguarding the privacy of Users while providing personalized and valuable service.
  • (1.3.) While We do Our best to protect Your information, particularly with respect to the protection of Your personal data, Eduvast cannot ensure the security of Your data transmitted via the internet, telephone or any other networks.
  • (1.4.) Access to the contents available  is conditional upon Your acceptance of this Privacy Policy which should be read together with the End User License Agreement“EULA”.
  • (1.5.) If You do not agree to any of the provisions of this Privacy Policy or EULA, You should not download, install and use the App. We may revise, alter, add, amend or modify this Privacy Policy at any time by updating this privacy policy. By downloading, installing and/or using this App, You agree to be bound by any such alteration, amendment, addition or modification.
2. Information Collected Non Personal Information
  • (2.1.) We may collect non-personal information about You whenever You access or interact with Our Website or any of the related services. This includes but not limited to browser name, version, server location, device specific information such as the type of device used, users’ operating system and version, your mobile devices unique device ID, third party apps or App or service that referred users to App, language preference, means of connection to App, internet service providers, IP address, technical information, google advertising ID (GAID), IDFA, GAID Opt-out Status, location information, interaction of Your device with the App and applications, details of Your device including without limitation its manufacturer details, height and width of your device screen, model, version, UDID or IMEI Number and other similar information about You(collectively "Traffic Data”). Personal Information
  • (2.2.) 2.2. We may collect personal information that identifies You in a variety of ways, including, but not limited to the information submitted during download and installation of the App or in connection with registration for other activities or features offered through the App. Personally identifiable information collected may include name, mailing address, email address, phone number and demographic information such as gender, nationality, postcode and other personal information including but not limited to date, time or place of birth ("Personal Information"). If You communicate with Us by, for example, e-mail or letter, any information provided in such communication may be collected by Eduvast.
  • (2.3.) Our website may transmit your Personal Information to our internal servers. This Personal Information is immediately deleted once you delete the App, except to the extent it is necessary to store the same under applicable laws. Further, we have implemented commercially reasonable physical, managerial, operational and technical security measures to protect the loss, misuse and alteration and to preserve the security of the Personal Information in our care.Finally, this information is used strictly in line with our business purposes.
  • (2.4.) You understand that once You leave Our servers, use of any information You provide shall be governed by the privacy policy of the operator of the site used by You.
3. Disclosure of Personal Information
    • (3.1.) We do not disclose Your Personal Information to any third parties other than as may be required by us, Eduvast’s affiliates, partners, trusted business networks, in compliance with our Privacy Policy for the purpose of moderating the content of the Website, enhancing Your user experience, providing You localised content and to enable Us and Our partners to provide You with targeted information which may be of benefit to you.
    • (3.2.) To enhance customer experience and to provide focused support, we may share generic aggregated demographic information which may include Your information collected by Us but not linked to any personally identifiable information regarding visitors and users with Our business partners, trusted affiliates and advertisers for the purposes outlined above.
    • (3.3.) At times We are required by law or litigation to disclose personal information about the users. We may also disclose information about the user if We determine that disclosure of information is necessary for national security, law enforcement, or other issues of public importance.
    • (3.4.) We use Our best efforts to use information in aggregate form (so that no individual User is identified) for the following purposes:
(3.4.1) To build up marketing profiles; (3.4.2) To aid strategic development, data collection and business analytics; (3.4.3) To manage our relationship with advertisers and partners; (3.4.4) 3.4.4. To audit usage of Our website i.e. www.www.eduvast.com (3.4.5) 3.4.5. To enhance user experience in relation to the App and Our website (collectively, “Permitted Use”).
  • (3.5.) We reserve the right to disclose Personal Information if required to do so by law or if we believe that it is necessary to do so to protect and defend the rights, property or personal safety of Eduvast, the App, or Users.
4. Cookies
  • (4.1.) Whenever You access the App We may place "cookies" on Your hard drive for record-keeping purposes to enhance Your experience or sometimes to personalize Your experience. Cookies are small text files that are placed on Your device's hard drive by the App You visit. Cookies help Us to identify information relating Your activities and to retain information relating to Your preferences and history on the App.
  • (4.2.) Ad targeting cookies: We and/or Our service providers may use advertising cookies to deliver ads that are more relevant to You and Your interests.
  • (4.3.) You may choose to disable cookies by turning off cookie feature on the web browser. However, by disabling this feature, some parts of the App may not function properly. This may prevent You from taking full advantage of the App.
5. Confidentiality
    • (5.1.) Except as otherwise provided in this Privacy Policy, We will keep Your Personal Information private and will not share it with third parties, unless We believe in good faith that disclosure of Your Personal Information or any other information We collect about You is necessary for Permitted Use or to:
(5.1.1.) Comply with a court order or other legal process; (5.1.2.) Protect the rights, property or safety of Eduvast or another party; (5.1.3.) Enforce the Agreement, including EULA; or (5.1.4.) Respond to claims that any posting or other content violates the rights of third-parties. 6. Security
  • (6.1.) The security of Your Personal Information is important to Us. We follow generally accepted industry standards to protect the Personal Information submitted to Us, both during transmission and once We receive it.
  • (6.2.) Although We make best possible efforts to store Personal Information in a secure operating environment which is not open to the public, You should understand that there is no such thing as complete security, and We do not guarantee that there will be no unintended disclosures of Your Personal Information. If We become aware that Your Personal Information has been disclosed in a manner not in accordance with this Privacy Policy, We will use reasonable efforts to notify You of the nature and extent of such disclosure (to the extent We know that information) as soon as reasonably possible and as permitted by law.
7. Updates and Changes to Privacy Policy
  • We reserve the right, at any time, to add to, change, update, or modify this Privacy Policy so please review it frequently. In all cases, use of information We collect is subject to the Privacy Policy in effect at the time such information is collected. You hereby acknowledge and agree that it is Your responsibility to review this Privacy Policy periodically and become aware of the modifications. If You disagree to any of the changes to the Privacy Policy, You shall refrain from using or accessing the App. Your continued use of the App following the posting of the revised Policy shall indicate Your acceptance and acknowledgment of the changes and You will be bound by it.
8. Updates and Changes to Your Personal Information
  • You have a right to correct any errors in Your Personal Information available with Us. You may request Us in writing that We cease to use Your Personal Information.
9. Contact Us
  • You may write to us at [email protected] for any privacy concerns and requests relating to this EULA and Privacy Policy.
Save settings
Cookies settings