PolicyWala
15-02-2009, 05:08 PM
What is Provident Fund ?
1. Provident Fund and Miscellaneous Scheme Act was made an Act in 1952 as a social Security measure.
2. It contains three benefits:
Provident Fund
Family Pension
Employees’ Deposit-Linked Insurance Scheme (EDLI)
3. Employees and employers contribute equally for PF and Family Pension, while EDLI is administered out of contributions made by Employer only.
4. Provident Fund is a compulsory saving.
5. It is applicable for all organizations having 10 or more employees using power and employees drawing basic salary including Dearness Allowance up to Rs.6500/- per month.
6. It has contribution from employer and deductions from employees salary
7. Employers contribution is 12% where as employee has the option of contributing more as voluntary PF.
What Happens to the Contributions?
1. Employee’s Contribution : 12% of Basic is deducted from employees’ earning every month and deposited in the PF Account.
2. Employer’s contribution : 12% is split and deposited as :
8.33% in the Pension Fund
3.67% in the Provident Fund along with
Employees’ share of 12%
3. Employers & employees contribution to PF along with interest is accumulated in the PF account and the same can be viewed in the Annual return & reconciliation statement issued by the PF authorities every year for the period 1st April to 31st March, around June / July.
4. The total amount is transferred to PF Account number of individual employee. PF Account number is reflected in the Pay slip.
5. The PF account is maintained either with Regional Provident Fund Commissioner (RPFC), an authority under Act, or PF Trusts set up by organizations duly approved by PF and Tax Authorities.
6. The total deposit earns interest on closing annual balance. The rate of interest is decided and declared by EPFO, Ministry of Labor, Govt. of India on an annual basis. The rate of interest will be same across the country and companies.
Withdrawal & Transfer:
Withdrawal & Transfer of Accumulations:
1. Total deposit together with interest under Provident Fund can be withdrawn on meeting conditions of retirement or migrating overseas or not working for a specific duration by submitting Form 19 at old organization or can be transferred to new organization by filling up Form 13 and submitting it to new organization.
2. Employees get pension under Family Pension Scheme on attaining the age of retirement and nominees get the pension on expiry of member for life or attaining certain age.
3. In the event of death of the member covered under the act, the dependant family gets an insurance amount.
4. The accumulation is in the name of employee and it is his/her money. Employee receives an annual statement of accumulations and interest earned from RPFC or EPF Trust, as the case may be.
Where do we maintain our PF Account
1. Organization has to register with Regional Provident Fund Commissioner (RPFC).
2. All employees have a unique account number with the RPFC. The employee’s PF account number is reflected in Payslip.
1. Provident Fund and Miscellaneous Scheme Act was made an Act in 1952 as a social Security measure.
2. It contains three benefits:
Provident Fund
Family Pension
Employees’ Deposit-Linked Insurance Scheme (EDLI)
3. Employees and employers contribute equally for PF and Family Pension, while EDLI is administered out of contributions made by Employer only.
4. Provident Fund is a compulsory saving.
5. It is applicable for all organizations having 10 or more employees using power and employees drawing basic salary including Dearness Allowance up to Rs.6500/- per month.
6. It has contribution from employer and deductions from employees salary
7. Employers contribution is 12% where as employee has the option of contributing more as voluntary PF.
What Happens to the Contributions?
1. Employee’s Contribution : 12% of Basic is deducted from employees’ earning every month and deposited in the PF Account.
2. Employer’s contribution : 12% is split and deposited as :
8.33% in the Pension Fund
3.67% in the Provident Fund along with
Employees’ share of 12%
3. Employers & employees contribution to PF along with interest is accumulated in the PF account and the same can be viewed in the Annual return & reconciliation statement issued by the PF authorities every year for the period 1st April to 31st March, around June / July.
4. The total amount is transferred to PF Account number of individual employee. PF Account number is reflected in the Pay slip.
5. The PF account is maintained either with Regional Provident Fund Commissioner (RPFC), an authority under Act, or PF Trusts set up by organizations duly approved by PF and Tax Authorities.
6. The total deposit earns interest on closing annual balance. The rate of interest is decided and declared by EPFO, Ministry of Labor, Govt. of India on an annual basis. The rate of interest will be same across the country and companies.
Withdrawal & Transfer:
Withdrawal & Transfer of Accumulations:
1. Total deposit together with interest under Provident Fund can be withdrawn on meeting conditions of retirement or migrating overseas or not working for a specific duration by submitting Form 19 at old organization or can be transferred to new organization by filling up Form 13 and submitting it to new organization.
2. Employees get pension under Family Pension Scheme on attaining the age of retirement and nominees get the pension on expiry of member for life or attaining certain age.
3. In the event of death of the member covered under the act, the dependant family gets an insurance amount.
4. The accumulation is in the name of employee and it is his/her money. Employee receives an annual statement of accumulations and interest earned from RPFC or EPF Trust, as the case may be.
Where do we maintain our PF Account
1. Organization has to register with Regional Provident Fund Commissioner (RPFC).
2. All employees have a unique account number with the RPFC. The employee’s PF account number is reflected in Payslip.