EPF (Provident Fund) — contribution rates & coverage

Both employee and employer contribute 12% of (Basic + DA). Of the employer's 12%, 8.33% goes to the Pension Scheme (EPS, capped at ₹15,000 wage = ₹1,250/month) and the balance 3.67% to EPF. Mandatory for establishments with 20+ employees; statutory wage ceiling ₹15,000/month. Deposit by the 15th of the next month.

Key points

• Coverage: the EPF Act applies to every establishment employing 20 OR MORE persons (and to notified classes).
• CONTRIBUTION: the EMPLOYEE contributes 12% of wages (Basic + Dearness Allowance + retaining allowance);
• the EMPLOYER contributes a matching 12%.
• The employer's share is split: 8.33% to the EMPLOYEES' PENSION SCHEME (EPS) — but only on wages up to the ₹15,000/month ceiling, i.e. a maximum of ₹1,250/month — and the REMAINING amount (3.67% on full wage, plus the excess over the EPS cap) to the EPF account.
• ADMIN CHARGES: the employer also pays EPF administrative charges of 0.5% (minimum ₹500/month) and EDLI (insurance) of 0.5% (capped at the ₹15,000 wage).
• The statutory wage CEILING for mandatory coverage is ₹15,000/month;
• an employee earning above it may still be covered if already a member or by joint option.
• Higher voluntary contribution (VPF) is allowed by the employee.
• PAYMENT is due by the 15TH of the following month (ECR via the EPFO portal);
• late deposit attracts interest under §7Q (12% p.a.) and damages under §14B, and is DISALLOWED for income-tax under §36(1)(va) if not paid by the EPF due date.

Reference: EPF & MP Act 1952 read with EPF Scheme 1952 & EPS 1995