Employees Provident fund organisation,india ( EPFO ) EPF rates and calculation
The Epf& MP (Miscellaneous provision act) act was came in to existence from March 14 th 1952.The act is applicable all over India except the state of Jammu and Kashmir.Presently the following three schemes are providing toemployees under this act.
- Employee provident fund scheme (EPF) 1952.
- Employees’ pension scheme (EPS) 1995
- Employees deposit linked insurance (EDLIS) 1976.
An establishment with 20 or more workers should register with Employees provident fund organization which comes under any of the 180 industries mentioned. Click here for the list of industries comes under EPF. Even though there are certainexemptions are there will be discussed in another post. Here we mainly aimed for EPF rates and its calculation.
EPF, EPS, EDLIS rates in India
EPF, EPS and EDLIS are calculated on Basic salary, dearnessallowances, cash value of food concession and retaining allowances if any.
“Retaining allowances means an allowance payable for the time being to an employee of any factory or other establishment during any period in which the establishment is not working, for retaining his services.”
Most of the organizations are following Basic+ DA Method. Below table tells you the rates of contribution of EPF, EPS, EDLI, Admin charges in India.
| Scheme Name | Employee contribution | Employer contribution | Paid to A/c No |
| Employee provident fund | 12% | 3.67% | 1 |
| Employees’ Pension scheme | 0 | 8.33% | 10 |
| Employees Deposit linked insurance | 0 | 0.5% | 21 |
| EPF Administrative charges | 0 | 1.1% | 2 |
| EDLIS Administrative charges | 0 | 0.01% | 22 |
Sick industries like beedi, jute, guar gum factories, coir industry other than spinning sector
| Scheme Name | Employee contribution | Employer contribution | Paid to A/c No |
| Employee provident fund | 10% | 1.67% | 1 |
| Employees’ Pension scheme | 0 | 8.33% | 10 |
| Employees Deposit linked insurance | 0 | 0.5% | 21 |
| EPF Administrative charges | 0 | 1.1% | 2 |
| EDLIS Administrative charges | 0 | 0.01% | 22 |
Inspection charges payable by employer
Inspection charges must be paid by the employer in the following Cases.
- Some establishment are exempted from EDLI contribution as they are providing the same nature of benefit without any contributions from employee, such establishments are liable to pay 0.005% on Basic salary
- The establishments exempted under the scheme should pay 0.18% of Basic salary towards inspection charges.
EPF Ceiling Limit
Epf ceiling limit is fixed to 6500/-.The employer is liable to pay contribution only on 6500/- Whatever is the basic salary
Calculation of Employees provident fund
Let us calculate the contribution of an employee who is getting a basic salary of Rs 3500/-
| Contribution Towards | Calculation | Amount |
| EPF Employees share | 3500 x 12% | 420 |
| EPS Employer share | 3500 x 8.33% | 292 |
| EPF employer share | 3500 x 3.67% | 128 |
| EDLI charges | 3500 x 0.5% | 18 |
| EPF Admin charges | 3500 x 1.1% | 39 |
| EDLI Admin charges | 3500 x 0.01% | 0.35 ( round up to Rs 1/-) |
The above calculation is easy and thereno complication.
Calculation of EPF for employees getting a basic salary over and above the ceiling limit 6500/-
In such cases companies uses different method for calculation as per their pay roll policy.
Consider an employee getting a basic salary of 7500/-
We can calculate it in different ways. The only thing you should take care is, EPS is calculated only up to 6500/- that means the maximum amount is fixed to Rs 541.00. The three methods mentioned below are based on the above example.
Method-1
If your company consider total basic salary above the limit fixed 6500.00 for PF calculation
| Contribution Towards | Calculation | Amount |
| EPF Employees share | 7500 x 12% | 900 |
| EPS Employer share | 6500 x 8.33% | 541 |
| EPF employer share | 7500 x 12% (-) 541 | 359 |
| EDLI charges | 6500 x 0.5% | 32.5 |
| EPF Admin charges | 6500 x 1.1% | 71.5 |
| EDLI Admin charges | 6500 x 0.01% | 0.65 ( Round up to Rs 1/-) |
I will explain how Employer contribution of EPS and EPF is calculated.
Employer is decided to contribute on total basic salary which is 12 % on 7500.00 equal to 900.00
EPS Share is fixed to 541.00
Balance (900-541) goes to EPF account 359.00
Total share 900.00
Out of Rs 900.00 EPS share is RS 541/- which is fixed for a basic salary greater than 6500/-. The balance amount is 900-541 = 359.00 which willgo to EPF account.
You may be thinking that, what about 3.67%?, Here you don’t need to care about it.
Method2
Some companies follows the below method in which employee share is calculated on 7500/- and employer share is calculated on up limit Rs 6500/-
| Contribution Towards | Calculation | Amount |
| EPF Employees share | 7500 x 12% | 900 |
| EPS Employer share | 6500 x 8.33% | 541 |
| EPF employer share | 6500 x 3.67% | 239 |
| EDLI charges | 6500 x 0.5% | 33 |
| EPF Admin charges | 6500 x 1.1% | 72 |
| EDLI Admin charges | 6500 x 0.01% | 0.65 ( Round up to Rs 1/-) |
Method3
Some are calculating both employer and employee shares on 6500/- in spite of higher basic salary than 6500.00
| Contribution Towards | Calculation | Amount |
| EPF Employees share | 6500 x 12% | 780 |
| EPS Employer share | 6500 x 8.33% | 541 |
| EPF employer share | 6500 x 3.67% | 239 |
| EDLI charges | 6500 x 0.5% | 33 |
| EPF Admin charges | 6500 x 1.1% | 72 |
| EDLI Admin charges | 6500 x 0.01% | 0.65 ( Round up to Rs 1/-) |
YOU CAN DOWNLOAD AN EPF CALCULATOR IN EXCEL FORMAT HERE
It is the duty of employer to remit the contribution deducted to the government before 15th of the following month.
Employer interest Liability
Employers are liable to pay @12% interest on late payment of EPF, EPS, EDLI, Administrative charges
Damage liability
An employer is remitting EPF, EPS, EDLI, and Admin charges late shall be liable to pay damages as penalty ranging from 17% to 37% depending up on delay.
I don’t think the above post is a complete one, if you have different opinion and experience we can discuss it in our comment section that will make this post a complete one.
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Related posts:
- Rights of employees as per employees provident fund scheme
- Esi-employees state insurance and its calculation
- EPF,ESI calculation in excel format
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Dear Sir,
It would be nice if a formate in Excell is created, where in figures from salary slip can be entered to get subsequent gross balance in account of employed, at any given date, assuming that employer has deposited the required money towards employer & employees share with government in time.The formate should start from inception of the scheme. The member can start entering from his contribution month & year in service.
A slip comes from the EPFO every year just giving the balance at a/c of both but it needs to be prechecked & tallied by our excell formate.
Sir,
I am working in an educational institution. My Basic plus D.A. is more than Rs. 6,500 p.m. Can you please let me know that how much PF can be deducted (Employee’s share and Employer’s share)per month from my basic plus DA (as it is more that Rs. 6,500)?
Kindly reply on my email. Thanks.
Employer is liable to contribute only on Rs 6500/- as per rule .It is the decision of employer or as per your establishment payroll policy;whether they contribute over and above 6500.00, if your contribution( employee contribution) is on 6500/- you can request your employer to deduct more amount from your salary as Voluntary PF. In that case employer need not contribute equal share. but you enjoy all the benefit of PF.
hai guys
i am having a doubt that the above said all conditions have been satisfied but from which amount of salary does the epf deductions start
regards
saikumar
hai if amy body whats to give a reply please forword it my e-mail
varikutisai@gmail.com
dear sir,
who will contribute edli charges, epf admincharges and edli admin charges. Please clarify sir.
regards,
mohan
Edli charges, edli admin, epf admin charges is the liability of the employer
Dear Sir,
i hari sarvotham reddy i want deatails about froms in ESI,EPF
how to write a letter to change of name in pf account, pl give the letter format in my email id.
What will be the maximum rate of voluntary contribution? any limit is there?
sir pl let me know how to calculate the pf and pension amount after the retirement
thanq
sir
my employer contribution to EPS is 8.33% higher salary
and EPF contribition is 3.67 % of higher salary
this calculation is not shown by you . is this contribution method is correct?
please explain
July 20, 2010
Dear sir,
Pl. send me details of Interest Rates applied/declared/approved by Govt. of India on epf/pf amount deducted from employees salaries year wise since the year 1987 to 2010 and oblige.
With regards
Thanks
Gopal Shah
Eg : Basic 10,000/- Restricted to EPS Employer share 6500 x 8.33% 541 for a month.
Q : if a person/employee works for only 20 days in a given (month = days) how to calculate?? (EPS)
Regards
Srinivasan
Hi
Please send me the EDLI Calculation in Form 12 A (Monthly Retun ) , Ceiling is Rs. 6500 .
Please send me the monthly return format
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