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 A PF Act is created with a purpose of providing

financial security and stability to elderly people.


 It’s purpose is to help employees save a fraction of
their salary every month, to be used in an event
that the employee is temporarily or no longer fit to
work or at retirement.
 EPFO is one of the largest society security
organization in the world in terms of members and
volume of financial transactions undertaken.
 EPFO is a statutory body of the Indian govt. under
labor & employment ministry.
Provides that:

The state shall within the limits of its economic


capacity make effective provision for securing
the right to work, to education, and to public
assistance in cases of unemployment, old-age,
sickness & disablement and undeserved want.
The Act consist of:

Employees’
Employees’ Employees’
Deposit linked
Provident Fund, Pension Scheme,
Insurance Scheme,
1952 (EPF) 1995 (EPS)
1976 (EDLI)
 THE EMPLOYEE’S PROVIDENT FUND ACT, 1952
 INTRODUCTION
 ELIGIBILITY
 ELIGIBILITY AND ENTITLEMENT
 CALCULATION
 BENEFITS
 INTEREST
 NOMINATION
 ANNUAL STATEMENT OF ACCOUNTS
 FULL SETTLEMENTS
 ADVANCES/WITHDRAWALS
 EMPLOYER’S ROLE AND RESPONSIBILITY
i. MONTHLY RETURNS
ii. ANNUAL RETURNS
iii. PENALITY
iv. EXEMPTION
 EMPLOYEE’S ROLE AND RESPONSIBILITY
 EMPLOYEES PENSION SCHEME, 1995
 INTRODUCTION
 PENSION BENEFITS
 ELIGIBILITY
 CONTRIBUTION IN EPF & EPS
 APPLICATION & FACTS

 THE EMPLOYEES DEPOSIT-LINKED INSURANCE SCHEME, 1976 (EDLI)


 APPLICATION
 CALCULATION
 ELIGIBLE
 EXEMPTION

 LIST OF FORMS

 FORMS & CHALLAN DESCRIPTION


Employees
provident
fund, 1952
The employee’s provident funds act 1952

 INTRODUCTION:

• Salary consist of two parts i.e. earnings and


deductions

• It is one of the statutory deduction done by


the employer at the time of
payment of salary

• This act has come into force to give better


future to employees on their retirement or to his
dependents in case of his death during
employment

• It is the compulsory contributory fund for


the future of an employee after retirement or
for his dependents in case of early death

• This act is applicable to all state except J&K..


 ELIGIBILITY:

• every industry employing 20 or more persons (180 industries are specified in


schedule 1 of the act)

• every industry employing 20 or more persons which the central govt. may
notify

• any other establishment notify by the central govt. even if employed person
are less than 20
 ELIGIBILITY AND ENTITLEMENT:

• Every employee employed directly/through a contractor who is in receipt


of wages are eligible of become the member of this fund (exception- apprentice
under the apprentice act and casual worker)

• Irrespective of permanent/probationary employees, every other employee


is eligible for joining the PF scheme from the date of joining of service

• minimum 10% of basic pay for establishment employed less than 20


persons; sick industries declared by necessary authority; beedi, jute, brick, coir,
guar gum factories/industries

• other industries 12% of basic pay

• a member can contribute voluntarily more than the statutorily prescribed


rate (up to 100% of basic pay) which is transferred to his PF A/c
 CALCULATION:

• 12% contribution by employee directly transferred to his PF A/c

• 12% contribution by the employer out of which 8.33% is transferred to


employee pension scheme and REST i.e. 3.67% is transferred to PF A/c

• 1.10% administration charges on total wages payable by the employer

• 0.50% EDLI is calculated on total EDLI slab (Rs. 15000) wages and payable
by employer towards EDLI fund

• 0.01% EDLI administration charges on total EDLI is payable by employer


 BENEFITS:

• employees can take advances/withdrawal the PF in case of retirement,


medical care, housing, for the education of children, etc…

• up to 90% of amount can be withdrawn at the age of 54 years or before one


year of actual retirement. (Form 19)

• PF amount of deceased person is payable to his nominees/legal heirs

• equal contribution by the employer

• present interest rate 8.6%

• PF a/c can be transferred if employee changed from one establishment to


other where PF facility is available
The employee’s provident funds act 1952

 INTEREST:

• Interest is credited to member PF a/c on monthly running balance

• Interest rate is fixed by the central govt. in consultation with the


central board of trustees of EEPF every year of march/ April

• Interest rate is fixed i.e.8.6%


 NOMINATION:

• The member can nominate to any


person/ persons to receive amount in case
of his death (Form 2, revised)

• The details provided by the member is


maintained at the regional provident fund
office which is used at time of death of the
member
 ANNUAL STATEMENT OF ACCOUNTS:

• After the close of each year of contribution, annual account


sent to each member through establishment where the member
was last employed through form 23

• Form 23 shows the opening balance at the beginning of the


year, amount contributed, interest credited at the end of the
period and the closing balance at the end

• If any error is noticed in the form 23, the member shall bring
the same to the noticed of PF officer through the employer
within 6 months from the date of receipt of statement
 FULL SETTLEMENTS:

• PF a/c settled immediately under the circumstances :-


- retirement after 58 years
- retirement on account of permanent incapacity
- termination of service on retrenchment
- voluntary retirement scheme
- permanent migration from India to settle abroad/taking
employment
- for female employee leaving service for getting married

• PF a/c settled after two months under the circumstances:-


- from resignation of service
Employees
Pension
Scheme, 1995
 INTRODUCTION:

Family Pension Scheme, 1971: (on or before the 15.11.1995)


 If member is alive, no pension
 If member is not alive, pension to spouse only
 Pension amount was also very small as the contribution collected
to the scheme is only 3.34% (1.67%x2) of the wages
 This scheme ceased when the EPS-95 came into existence.

Employees Pension Scheme, 1995 (after the 15.11.1995)


 If member is alive, pension to member
 If member is not alive, pension to spouse and 2 children below 25
years of age
 This scheme is applicable to all members who joined EPF after
15.11.1995
EPS, 1995 offers pension on disablement, widow pension,
and pension for nominees.
It is financed by diverting 8.33% of employer’s monthly contribution from
the EPF (restricted to 8.33% of 6500 or Rs. 541) and govt. contribution of
1.17% of the worker’s monthly wages.

The purpose of the scheme is to provide for:


1) Superannuation Pension: member who has rendered eligible service of 20 yrs.
And retires on attaining the age of 58 yrs.
2) Retiring Pension: member who has rendered eligible service of 20 yrs. and
retires or otherwise ceases to be in employment before attaining the age of 58 yrs.
3) Permanent Total Disablement Pension
4) Short Service Pension: member has to render eligible service of 10yrs. And
more but less than 20 yrs.
Pension Benefits
Lifelong pension is available to the member and upon his death
members of the family are entitled for the pension.

 The monthly retiring pension is decided on the basis of


‘pensionable Service’ and ‘pension Salary’ and is worked out as
follows:

Monthly Pension = (pensionable Salary x pensionable Service) / 70

• Pensionable Salary is the average contributing Salary immediately


Preceding 12 months from the date of exit from the scheme,
normally this would be limited to RS. 6500/-
• Pensionable Service can not exceed 35 yrs.
THE EMPLOYEES DEPOSIT-LINKED
INSURANCE SCHEME, 1976
THE EMPLOYEES DEPOSIT-LINKED INSURANCE SCHEME, 1976
 APPLICATION:

• It is compulsory for all the members who are the member of PF scheme

• Life insurance benefits (death coverage) of the employees is available under this
scheme while in service

 CALCULATION:

• It is calculated on EDLI slab-RS. 15000

• 1.10% administration charges on total wages payable by the employer towards


EPF subject to minimum Rs. 5/-

(
• 0.50% EDLI is calculated on total EDLI slab (Rs. 15000) wages and payable by
employer towards EDLI fund

• 0.01% EDLI administration charges on total EDLI is payable by employer subject to


minimum Rs. 2/-
THE EMPLOYEES DEPOSIT-LINKED INSURANCE SCHEME, 1976
 ELIGIBLE:

• Person who is eligible to receive PF dues of deceased member who died


while in service is only eligible to receive EDLI fund

 EXEMPTION:

• Employer can seek exemption from the scheme if similar/better benefits


are provided other than the scheme with the consent of majority of
employee

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