PROVIDENT FUND

For PF formalities the company must be 3 years old. After that only it can be registered
with the PF department. Even for this Act also the minimum number of employee should
be 20.
Employees drawing basic salary upto Rs !00"# have to compulsory contribute to the
Provident fund and employees drawing above Rs !0$"# have an option to become
member of the Provident Fund .
%t is mandatory for employees completing $0 years of service to opt for Pension.
Employee completing $0 years of service can not withdraw entire PF &employer
and employees contribution'. (hey are allowed to withdraw their contribution
$2) and Employers contribution of 3.*) to PF. +alance amount i.e. Employer
contribution amounting to ,.33) will be paid by way of pension &calculation
done by PF office basis no of years of service and some ratios- all details not
.nown'.
(herefore it is advisable not to withdraw PF and continue with the same by
transferring old PF no to new employer.
Every employer of an establishment to which the Employee Provident Fund Act applies-
should submit in Form !A&in duplicate' to the commissioner- particulars of all the
branches and departments- owners- directors- partners if any or any other person who is
controlling its affair within $! days of its applicability of the scheme.
/n receipt of Form !A- the commissioner shall verify the particulars submitted and after
been satisfied shall allot an Establishment 0ode 1o.
Form 5A of EPF is a return of /wnership which is normally submitted to the EPF/ at
the time the company is covered by EPF 2chemes for the first time. (his form shows who
are the owners" partners or 3irectors of the company and who is responsible for the
conduct of the business of the company. %n form !A details of employers only is given
though the company may be managed by the 4anager or the person who loo.s after the
PF and related matters is the Personnel 4anager" 5R 4anager of the company. %t is on
the basis of the information given in form !A that the PF authorities will initiate
prosecution or criminal case against an employer who fails to remit the contributions in
time.
6henever any change ta.es place in the constitution or the board of 3irectors- a fresh
form !A showing the new owners" directors should be submitted to the EPF/.
What all PF office requires at inspection
$. 2tatement of staff strength to chec. the no of employees are below 20 during
the time the benefit of PF was not e7tended.
&year and month wise statement since the commencement of business giving no of
employees on payroll- name- designation etc are not needed'
2. 4uster since commencement of business.
3. 0ertificate of %ncorporation
8. 0ertificate of 0ommencement of business
!. 2hop 9 Establishment license
. 4emorandum of Articles of Association
*. 2alary 2heet for 3 previous months.
,. :ist of 3irectors with address
;. :ist of employees to be covered with reference to date of <oining to allot PF
numbers to individual employee.

cheme Name Emplo!ee
contri"ution
Emplo!er
contri"ution
Pai# to A$c No
Emplo!ee pro%i#ent
fun#
$2) 3.*) $
Emplo!ees& Pension
scheme
0 ,.33) $0
Emplo!ees Deposit
lin'e# insurance
0 0.!) 2$
EPF A#ministrati%e
char(es
0 $.$) 2
ED)I A#ministrati%e
char(es
0 0.0$) 22
ic' in#ustries li'e "ee#i* +ute* (uar (um factories* coir in#ustr! other than spinnin(
sector
cheme Name Emplo!ee
contri"ution
Emplo!er
contri"ution
Pai# to A$c No
Employee provident
fund
$0) $.*) $
Employees= Pension
scheme
0 ,.33) $0
Employees 3eposit
lin.ed insurance
0 0.!) 2$
EPF Administrative
charges
0 $.$) 2
E3:%2 Administrative
charges
0 0.0$) 22
:et us calculate the contribution of an employee who is getting a basic salary of Rs
3!00"#
0ontribution (owards 0alculation Amount
EPF Emplo!ees share 3!00 7 $2) 820
EP Emplo!er share 3!00 7 ,.33) 2;2
EPF emplo!er share 3!00 7 3.*) $2,
ED)I char(es 3!00 7 0.!) $,
EPF A#min char(es 3!00 7 $.$) 3;
ED)I A#min char(es 3!00 7 0.0$) 0.3! & round up to Rs $"#'
(he above calculation is easy .
,alculation of EPF for emplo!ees (ettin( a "asic salar! o%er an# a"o%e the ceilin(
limit -5..$/
%n such cases companies uses different method for calculation as per their pay roll policy.
,onsi#er an emplo!ee (ettin( a "asic salar! of 05..$/
6e can calculate it in different ways. (he only thing you should ta.e care is- EP2 is
calculated only up to !00"# that means the ma7imum amount is fi7ed to Rs !8$.00. (he
three methods mentioned below are based on the above e7ample.
1etho#/2
If !our compan! consi#er total "asic salar! a"o%e the limit fi3e# -5..4.. for PF
calculation
0ontribution (owards 0alculation Amount
EPF Emplo!ees share *!00 7 $2) ;00
EP Emplo!er share -5.. 3 54667 !8$
EPF emplo!er share 05.. 3 287 9/: 5;2 3!;
ED)I char(es !00 7 0.!) 32.!
EPF A#min char(es !00 7 $.$) *$.!
ED)I A#min char(es !00 7 0.0$) 0.! & Round up to Rs $"#'
% will e7plain how Employer contribution of EP2 and EPF is calculated.
Employer is decided to contribute on total basic salary which is $2 ) on *!00.00 e>ual to
;00.00
EP2 2hare is fi7ed to !8$.00
+alance &;00#!8$' goes to EPF account 3!;.00
(otal share <..4..
/ut of Rs ;00.00 EP2 share is R2 !8$"# which is fi7ed for a basic salary greater than
!00"#. (he balance amount is ;00#!8$ ? 3!;.00 which willgo to EPF account.
@ou may be thin.ing that- what about 3.*)A- 5ere you don=t need to care about it.
1etho#8
2ome companies follows the below method in which employee share is calculated on
*!00"# and employer share is calculated on up limit Rs !00"#
0ontribution (owards 0alculation Amount
EPF Emplo!ees share *!00 7 $2) ;00
EP Emplo!er share !00 7 ,.33) !8$
EPF emplo!er share !00 7 3.*) 23;
ED)I char(es !00 7 0.!) 33
EPF A#min char(es !00 7 $.$) *2
ED)I A#min char(es !00 7 0.0$) 0.! & Round up to Rs $"#'
1etho#6
2ome are calculating both employer and employee shares on !00"# in spite of higher
basic salary than !00.00
0ontribution (owards 0alculation Amount
EPF Emplo!ees share !00 7 $2) *,0
EP Emplo!er share !00 7 ,.33) !8$
EPF emplo!er share !00 7 3.*) 23;
ED)I char(es !00 7 0.!) 33
EPF A#min char(es !00 7 $.$) *2
ED)I A#min char(es !00 7 0.0$) 0.! & Round up to Rs $"#'
At the time of joining an employee has to fill the following forms
Form / 22
2elf declaration form mentioning the name- address and any P.F no. allotted to him by
any previous company where he was wor.ing.
Form No422 & Eleven' under EPF scheme pertains to information provided by an
employee while <oining a new employer- about his previous previous employments with
name and address of employers along with duration of service. %n this form a new <oinee
also declares that whether he was previously a member of EPF scheme or not. (his form
is to be .ept by an employer and not to be deposited with 2ub"Regional commissioner.
EPF inspector while inspecting records of an establishment may as. for these forms to
chec. the eligibility criteria.
(he Form $$ of EPF is a declaration by the employee for certifying that wherever has has
wor.ed"or not wor.ed- he never had a PF account number. (he govt has introduced this
form in order to stop the system of having multiple numbers of one employee. i.e.
suppose you <oined A co. you had B PF account no. and later you <oined you had @ PF
account no. in that case employee should get the PF account transferred thru his
employer- thatCs a responsibility on the employee but nobody does that. in order to save
themselves- the employer gets the form $$ filled by the employee and this form is .ept
with the employer only and it shud be produced before the inspector upon inspection.
Form 8
1omination form mentioning the name of nominee"s to get the share of money in case
something accidental happens to you .
Form 2D Employee should fill- at the time of <oining- nomination 9 3eclaration form.
Form 8* inclu#es the follo=in(
E 1ame of the employee
E Parent"spouse name
E 3ate of +irth
E 2e7
E 4arital 2tatus
E A0 1o
E Address
E 1ames- address- relation- 2hare for each etc
Also for changing nominee names Form 2 is used. 5is eligibility begins on the date of
<oining the firm. 2ubmitted along with form#!.
FOR E1P)O>ER
EPF ,hallan
EPF will be deduct on +asic salary F $2) Employee share and $3.$ ) Employer share.
A$, Nos4?/
$' A"c 1o. $D# 3.* ) of Employer and $2 ) &Employee PF.'
2' A"0 1o. 2D# $.$0 ) of Employer &PF %nspection E7p.'
3' A"0 1o. $0D# ,.33 Employer &Eemployee Pention scheme'
8' A"0 1o. 2$D# 0.!0) Employer &E3:%'
!' A"0 1o. 22D# 0.0$) &E3:% Admn. E7p.'
After that EPF challan shoul# "e #eposite# "efore 25th of e%er! month but there is
days for grace period.
About PF 0hallan formD#
$' 1ame of Address of +ranch &2+%' where you /rganiGation deposit EPF.
2' Establishment 0odeD# Hiven by EPF 3ept.
3' 3ues for the 4"/D# means for which month you are depositing EPF
8' 3ate of PaymentD# 3ate of deposit of fund.
!' (otal 1o. of 2ubcribersD 4eans total nos. of employees from which wages PF
depositing.
' (otal 6agesD# (otal +asic wages of all Employees from which you will ta.en $2 ) of
employee share and $3.$ ) of employer share. (otal 6ages salary will be same for all
a"c. i.e. A"0 1o. $- A"0 1o. $0 and A"0 1o. 2$.
After depositing all the contributions of both employer and employee with the bank for
any month, by the 15th of the following month following records have to be filed with
P.F office
$. (riplicate copy of challan &out of 8 copies of the challan'
2. Form ! # list of all the employees newly <oined in that month

@efore 85 th P4F4 Form 5* inclu#es the follo=in(* 1onthl! "efore 85 th
1ame of the establishment and address
4onth
0ode noD of the factory
A c noD
1ame of new employees
Fathers or 5usband name in case of married women
3ate of birth
2e7
3ate of <oining the fund
(otal period of pervious services as on the date of <oining the fund
3. Form $0 # list of all the employees left during the same month.
@efore 85 th P4F4 Form 2.* inclu#es the follo=in(* 1onthl! "efore 85 th
1ame of the establishment and address
4onth
0ode noD of the establishment
A c noD
1ame of member who is leaving
Fathers or 5usband name in case of married women
3ate of leaving service
Reasons for leaving service
2ignature of authorised officer and stamp of the establishment
8. Form # 2 collected from all the new employees covered in Form ! &<oined during the
corresponding month'
!. Form $2A # monthly return form
@efore 85 th P4F4 Form 28 A* inclu#es the follo=in(* 1onthl! "efore 85 th
1ame of the establishment and address
0urrency period and month &April yr to march yr'
2tatutory rate of contribution &$2)'
Hroup code &1A for une7empted establishment. Establishment having more than
$000 &%am note sure about e7act figure' have to .eep a PF trust and have to
specify the group code'
(otal wages due for each account &wages on which calculations are done'
Amount of contribution and amount remitted &consolidated amount with employer
and employee share'
3ate of remittance
(otal number of subscribers for the current month.
1ame and address of the ban. in which the amount is remitted.
3etails of subscribers for E.P.F- PF- E3:%
##1o of subscribers as per last month
##1o of new subscribers &vide F!'
##1o of subscribers left service &vide F $0'
##(otal no of subscribers &After adding and subtracting the new and retired
employees with- the number should tally with monthly list of employees'
0ross chec.ing the above is done with the salary statement.
WITADRAWER$?
FOR1 2., 9PENION: B FOR1 2< 9PF:
Form $; is used for withdrawing PF amount. Employee and parent"spouse name- name of
the establishment- Ac no- Reasons for leaving service- 0ontribution for current financial
year etc. Form $0 is used for pension withdrawal.
TRANFER ? FOR1 26
Form $3 is used for transferring an employee A0 from one company to another. +oth
employer and employee have to specify his name- PF A0 no- Position etc and submitted
with a covering letter &consolidated list of employees'. Photocopy of the above is .ept in
PF file for transfer.
8. Employee register 3A-
!. For advance D Form 3$
IN ,AE OF E1P)O>EE ECPIRED $ DEAD ?
Process #etails
Form $0 3 &For claiming benefits under Pension'
Employee should fill li.e E7pired"late employee name- nomination name- details-
1omination +an. a"cIfor monthly Pension
Form 20 &For 0laiming EPF 0ontributions'
Employee should fill li.e E7pired"late employee name- nomination name- details-
1omination +an. a"cIfor withdrawal of PF Fund &%ncase of 3eath of a member
Form ! %F &For 0laiming E3:% benefits- nominee will get benefit'
E3:% for death case- nominee will get benefit.
ANNUA) RETURN?
$. Form 3 A &%ndividual 0omputation sheet'
2. Form A &0onsolidated Annual 0ontribution 2tatement'
3. before 30th April every year
Form -A?
E 0urrency period and month &April yr to march yr'
E 1ame of the establishment and address
E 0ode noD of the establishment
E 1oD of member voluntary contributing at a higher rate
E A0 1o of each employee followed by their name- annual salary- annual
contribution- employer contribution- refund of advance- rate of voluntary
contribution.
E (his grand total should tally with all form $2 A and challans totals.
Form 6A? Re(ister
(his form is filled up for each employee stating his each monthly salary-
contribution- Employer share- Refund of advance- 1o of days"period of non
contributing service- if any &eg. unauthorised leave'. %f the employee is resigned
during that financial year then the date of leaving service and reasons for leaving
service should be specified in this form. Jsing Form 3A- form A is filled up and
crosschec.ing is done with all challans and $2 A forms.
P4F4 Annual Returns Form -A an# 6A
0urrency period and month &April yr to march yr'
1ame of the establishment and address
0ode noD of the establishment
1oD of member voluntary contributing at a higher rate
A0 1o of each employee followed by their name- annual salary- annual
contribution- employer contribution- refund of advance- rate of voluntary
contribution.
(his grand total should tally with all form $2 A and challan totals.
P4F4 Annual Returns Form 6A
(his form is filled up for each employee stating his each monthly salary- contribution- Employer share-
Refund of advance- 1o of days"period of non contributing service- if any &eg unauthorised leave'. %f the
employee is resigned during that financial year then the date of leaving service and reasons for leaving
service should be specified in this form. Jsing this form A is filled up and crosschec.ing is done with
all challans and $2 A forms.
FAD ON PROVIDENT FUND
D2: What is the ,ontri"ution for Pro%i#ent Fun# "oth "! the Emplo!er B
Emplo!ee E
Ans D (he Employee contributes $2) of his "her +asic 2alary 9 the same amount is
contributed by the Employer.
D8: Is it ,ompulsor! for the all the emplo!ees to contri"ute to the Pro%i#ent Fun# E
Ans D Employees drawing basic salary upto Rs !00"# have to compulsory contribute to
the Provident fund and employees drawing above Rs !0$"# have an option to become
member of the Provident Fund .
D6: Is it "eneficial for emplo!ees =ho #ra= salar! a"o%e Rs -5.2$/ to "ecome
mem"er of Pro%i#ent Fun# E
Ans @es because provident fund contribution by the employer 9 employee is not a
ta7able income for %ncome (a7 purpose.
D;: What if an emplo!ee =hile +oinin( esta"lishment has a "asic salar! of Rs ;8..
an# after some perio# of time his "asic salar! increases a"o%e Rs -5.2$/* #oes he
ha%e an option to terminate his mem"er ship form the Pro%i#ent fun# actE
Ans D Employee who while <oining the organisation has a basic salary above Rs !0$"#
have an option to either become or avoid becoming member of Provident fund but
employees whose basic salary while <oining the organisation is less then Rs !0$"# but
after some period of time their basic increases above Rs !0$"# have to compulsorily
continue to be member of provident Fund.
D5: What is the contri"ution percenta(e to the Pro%i#ent fun# an# Pension
cheme E
Ans D Employers contribution of $2) of basic salary is totally deposited in provident
fund account 6hereas out of Employees contribution of $2) - 3.*) is contributed to
Provident fund and ,.33) is deposited in Pension scheme.
D-: Which form has to "e fille# =hile "ecomin( mem"er of pro%i#ent fun# E
Ans D 1omination Form 1o 2 has to be filled to become a member of the Provident fund-
form is available with 5R department .
D0 : Which form has to "e fille# =hile transferrin( pro%i#ent fun# #eposit E
Ans D @ou <ust have to fill form no $3 to transfer your P.F amount.
D5 : What is the pro%ision of the scheme in the matter of nomination "! a mem"er E
Ans D Each member has to ma.e a nomination to receive the amount standing to his credit
in the fund in the event of his death. %f he has a family- he has to nominate one or more
person belonging to his family and none other. %f he has no family he can nominate any
person or persons of his choice but if he subse>uently ac>uires family- such nomination
becomes invalid and he will have to ma.e a fresh nomination of one or more persons
belonging to his family. @ou cannot ma.e your brother your nominee as per the Acts.
D< : When is an emplo!ee eli(i"le to en+o! pension scheme E
Ans D For an employee to become eligible for Pension fund- he has to complete
membership of the Fund for $0 @ears.
D2. : What #oes it mean "! continuous ser%ice of ten !ears E
Ans D 6hen we say continuous service of $0 years in Employee Pension Fund- we mean
to say that during services- for e.g.- an employee who has wor.ed with B company for
say 3 years- then he resigned from that organisation and <oined @ company- wherein he
wor.ed for 2 years- then resigned from there to <oin establishment for ! years but during
these $0 years of service he has not withdrawn but transferred his Employee pension
fund- then we say continuous service of ten years.
D22 : When can an emplo!ee a%ail the "enefit of Emplo!ee pension fun# scheme
=hich he has contri"ute# #urin( his ten !ears of continues ser%ice $
Ans D An employee can avail the benefit after completion of !, years of service.
D28 : What happens to the pro%i#ent fun# B Emplo!ee Pension fun# if an emplo!ee
=ho =ants to resi(n from the ser%ice "efore completion of ten !ears of continues
ser%iceE
Ans D Employee can withdraw the PF accumulations by filling Forms $; 9 $0 0 which is
available with the 5R department.
D26 : What is this 2< B 2., form E
Ans D Form 1o $; is for Provident fund withdrawal 9 Form 1o. $0 0 is for Pension
scheme withdrawal.
D2; : Do =e (et an! interest on the amount =hich is #eposite# in the Pro%i#ent
Fun# accountE
Ans D 0ompound interest as declared by the Hovt. is given for every year of service.
D25 : What is the accountin( !ear for Pro%i#ent fun# accountE
Ans D Accounting year is from 4arch to February.
D2- : What are the "enefits pro%i#e# un#er Emplo!ee Pro%i#ent Fun# chemeE
Ans D (wo .inds of benefits are provided under the scheme#
a' 6ithdrawal benefit
b' +enefit of non #Refundable advances
D25 : What is the purpose of the Emplo!eeFs Pension cheme E
Ans D (he purpose of the scheme is to provide for
$' 2uperannuation pension.
2' Retiring Pension.
3' Permanent (otal disablement Pension
2uperannuation PensionD 4ember who has rendered eligible service of 20 years and
retires on attaining the age of !, years.
Retirement PensionD member who has rendered eligible service of 20 years and retires or
otherwise ceases to be in employment before attaining the age of !, years.
2hort service PensionD 4ember has to render eligible service of $0 years and more but
less than 20 years.
D2< : Ao= much time #oes it ta'e to recei%e P4F B pension mone! if an emplo!ee
resi(ns from the er%iceE
Ans D 1ormally the procedure for receiving P.F 9 Pension money is - the employee has to
fill $; 9 $0 c Form and submit the same to PF 3es. - which is then submitted to the P.F
office after two months- this two months is nothing but a waiting period as the rules are
that an employee should not be in employment for two months after resigning if he has to
withdraw his P.F amount. After completion of two months the form is submitted to the
regional provident fund 0ommissioner office after which the employee receives his
amount along with interest within a period of ;0 days.
D8. : Do =e recei%e mone! throu(h postal or#er E
Ans Previously there was a procedure wherein member use to get P.F through Postal
order but now 6hile submitting the P.F form withdrawal form you have to mention your
saving +an. account 1o. 9 the complete address of the +an. where you hold the
account.
D82 : Ao= =oul# I 'no= the amount of accumulations in m! PF account E
Ans D PF office sends an annual statement through the employer which gives details about
the PF accumulations. (he statement contains details li.e- /pening balance- amount
contributed during the year- withdrawal during the year- interest earned and the closing
balance in the PF account. (his statement is sent by the PF department on completion of
the financial year.
D88 : Which esta"lishments are co%ere# "! the Act E
Ans D Any establishment which employs 20 or more employees. E7cept apprentice and
casual laborers- every Employee including contract labour who is in receipt of basic
salary up to Rs. !00 p.m. is covered by the Act.
D86 : In case after re(isterin( the esta"lishment at an! point in time* the num"er of
emplo!ees =or'in( in it "ecomes less than 8. then =ill the Act appl! E
Ans D Any establishment which has been covered under the Act once shall continue to be
governed by the Act even if the number of persons employed therein at any time falls
below 20.
D8; : Is the Act applica"le to a factor! =hich is close# #o=n "ut is emplo!in( a fe=
emplo!ees to loo' after the assets of the esta"lishment E
Ans D 1o- 6here the establishment is closed down and only four security men are
employed for .eeping a watch over the assets and properties of the establishments- the
Act would not be applicable.
D85 : Is a trainee an emplo!ee un#er the Act E
Ans D @es- a trainee would be considered as an employee as per the Act but in case the
trainee is an apprentice under the ApprenticeCs Act then he" she will not be considered as
an employee under this Act.
D8-: Is it possi"le to appeal the or#ers of the ,entral Go%ernment or the ,entral
Pro%i#ent Fun# ,ommissioner E
Ans D @es- there is a body called as Provident Fund Appellate (ribunal where an employer
can appeal.
D80 : Who is the authorit! to #eci#e re(ar#in( the #isputes if an! E
Ans D %n case there is a dispute regarding the applicability of the Act or the >uantum of
money to be deducted etc. the authority to decide are the
i'0entral Provident Fund 0ommissioner-
ii'any Additional Provident Fund 0ommissioner-
iii'any Additional 0entral Provident Fund 0ommissioner
iv'any 3eputy Provident Fund 0ommissioner
v'any Regional Provident Fund 0ommissioner or
vi'any Assistant Provident Fund 0ommissioner
D85 : What in case there are =or'ers in%ol%e# as ,ontract la"our E
Ans D %t is the responsibility of the 0ontractor to deduct the PF and submit a statement to
the Principal Employer in the prescribed format by *th of every month. (he 0ompany
becomes the Principal Employer would be responsible for the PF deduction of the
wor.ers employed on contract basis.
D8< : Are the persons emplo!e# "! or throu(h a contractor co%ere# un#er the
cheme E
Ans D Persons employed by or through a contractor are included in the definition of K
employee L under the EmployeeCs Provident Finds Act- $;!2- and as such- they are
covered under the 2cheme.
D6. : In case the ,ontractor fails to #e#uct an# su"mit the PF amount from the
contract =or'ers then =hat is to "e #one E
Ans D (he 0ompany being the Principal employer is responsible for the PF to be deducted
from the 0ontract wor.ers as well. %n case the 0ontractors fails to deduct and submit the
PF dues then the 0ompany has to pay the amount and can later on recover the amount
from the 0ontractor.
D62 : ,oul# the emplo!er "e punishe# in case the remittance of contri"ution "! him
is #ela!e# in a @an' or post office E
Ans D Employer cannot be punished or penaliGed in case there is a delay in the remittance
of the contribution on account of delay in +an. or post office.
D68 : What happens in case there is a salar! re%ision an# a raise in the "asic salar!
of the emplo!ee an# arrears nee# to "e pai#* Do =e nee# to #e#uct PF from the
arrears as =ell E
Ans D Arrears are considered to be emoluments earned by the employee and PF is to be
deducted from such arrears.
D66 : Is it possi"le for an emplo!ee to contri"ute at a hi(her rate of interest than 28
7 E
Ans D @es- if an employee desires to contribute an amount at a higher rate of interest than
$2 ) of basic salary then they can do so but it does not become obligatory for the
employer to pay anything above than $2 ).(his is called voluntary contribution and a
Moint 3eclaration Form needs to be filled up where the employer and the employee both
have to give a declaration as to the rate at which PF would be deducted.
D6; : What is the interest on the PF accumulations E
Ans D 0ompound interest as declared by 0entral Hovt. is paid on the amount standing to
the credit of an employee as on $st April every year.