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Employees’ Provident Fund (EPF)

Employees’ Provident Fund is a government organization that works under the central government works to promote the employees’ to save funds for their retirement. This scheme was launched by the Indian government in the year 1951 and the Ministry of Labour and employment governs this organization (EPFO). The schemes provided by EPFO are not just for the Indian workers but also for the workers who are outside of India which means workers from those countries with which EPFO has signed an agreement.

Employees Provident Fund

Objective of EPF

There are some main objectives of the Employees Provident Fund and those objectives are given below:

  • Ensuring one Employees’ Provident Fund account of every employee.
  • Easy facilitation of compliance 
  • Ensuring the working of the organization as per the set rules and regulations.
  • Online services are being provided without any problem and improving the facility regularly.
  • Easy access to the account through online mode for all the members.
  • Regular promotions and encouragements of the volunteers.
  • Reduction in the time duration of claim settlement from 20 days to 3 days.

Benefits of EPF

The Employment Provident Fund scheme has an array of benefits for the EPFs members. Thus, it inculcates a sense of security and financial stability in the employees. The employees can avail of the following benefits through the EPF scheme which is explained below:

  • Provides corpus for retirement: if an employee is having the EPF scheme for the long run, and around 8.33% of the employer’s contribution is directed towards the EPF. Then the sum that is deposited towards the EPF builds a healthy retirement corpus and with the help of such corpus, it would generate a sense of independence and financial stability in employees after retirement.
  • Capital appreciation: the pre-fixed interest rate on the deposits that are held by the EPF India online PF scheme. Moreover, the extended rewards at the time of its maturity help to ensure growth in the employee’s provident fund that also accelerates the capital appreciation.
  • Tax saving scheme: an employee’s contribution towards their PF account under Section 80C of the Indian Income Tax Act, is deemed eligible for the tax exemption, and the EPF schemes which generate earnings are also exempted from taxes. However, these exemptions availed a limit of up to Rs. 1.5 lacs. Therefore, the tax benefits that apply to the EPF schemes ensure the employee has higher earning. Moreover, it also improves the individual’s saving and purchasing power in the long run.
  • Emergency Corpus: to be financially prepared to face the uncertainties of life is the best thing to deal with unwarranted situations of an individual. Hence, EPF funds will also work as an emergency corpus of an individual when required.
  • Easy premature withdrawal: the investors of the EPF fund can also avail benefits of the premature or partial withdrawal. However, an individual can easily withdrawal their EPF fund in case of emergency or to meet the specific requirement of life.

EPFO Services

The EPFO provides several services and some of them are mentioned below:

  • Provide help for inoperative accounts: EPFO has set up an online help desk for those account holders who did not operate their accounts and also these accounts do not have any interest. In February 2015 this service was provided for the employees to track such accounts and also transfer their funds into any currently working member ID. The only requirement is to provide basic details about the previous employment which can be useful to track the inoperative account.
  • Withdrawal of Employees’ Provident Fund through online mode: If any employee is unemployed for the last 2 months or more are eligible for withdrawing their amount and can withdraw the fund through the online mode easily. The only requirement is that the details of the bank account and Aadhar card should be linked with UAN.
  • Generation of Coverage certificate for workers outside India: By taking the help from an online centralized software which is launched by EPFO itself, international workers in those countries that have Agreements signed with India can generate a certificate of Coverage (CoC).
  • Mobile app for various services: A mobile application is launched by EPFO named UMANG (Unified Mobile Application for New-Age Governance) which provides services like updating profile details, accessing Employees’ Provident Fund passbook, etc., employees can have the benefits of this app by just entering UAN and password.
  • Transfer of Employees’ Provident Fund through online mode: With the help of UAN the previous employee can transfer its EPF into the current member’s ID through online mode, without any paperwork and formalities.
  • Online registration of Establishments: Using the EPFO portal the Online Registration of Establishment (OLRE) can be done. 

There are so many other services also that have been provided by EPFO such as providing payments of PF through online mode, provide services of SMS and missed calls for the members of UAN to have access to their PF balance, etc.

EPFO Schemes

There are some schemes provided by EPFO for the benefit of employees and these schemes are given below:

  • Very first on the list is the Employees’ Provident Fund scheme which was launched in 1952, the full form of EPF is the Employees’ Provident Fund Scheme.
  • Next on this list is the EPS scheme which was launched after launching EPF (Employees’ Provident Fund) by, EPS (Employees’ Pension Scheme) was launched in 1995.
  • Another one is EDLI which means Employees’ Deposit Linked Insurance Scheme, which was launched by the EPFO in the year 1976.

EPF Contribution

Both the employer and the employee must contribute to the Employees’ Provident Fund, each of them contributes 12% of their basic salary and the employees’ dearness allowance. There are some details of the EPF contribution of the employer and the employee given below:

  • Employees’ Provident Fund contribution of employee: Every month 12% of the total salary has been deducted from the employee by the employer for the contribution towards EPF and deposits into the Employees’ Provident Fund account.
  • Employees’ Provident Fund contribution of employer: Just like the employee, the employer also has to contribute 12% of its total salary towards the Employees’ Provident Fund account.

UAN (Universal Account Number)

UAN is a 12-digit which is provided to every member of EPFO through which these members can easily access their PF accounts and manage them online like withdrawal and checking Employees’ Provident Fund balance. This service is available for all the subscribers of EPF. This 12-digit UAN remains the same no matter where the job of the member is and how many times does the job has been switched. 

But, if a member changes their job, the member ID is changed every time and to avail of the benefits of UAN, you should link this ID to the UAN. To be able to handle Employees’ Provident Fund account online and take the benefit of UAN, it is important to first activate the UAN.

EPF Interest Rate

It is easily possible to calculate the interest amount which has been added to the Employees’ Provident Fund account, this can be done at the end of the year which should be a financial year. Because this amount is added to the account with the existing amount at the end of the year to calculate the total amount. Right now, PF interest rate on Employees’ Provident Fund is calculated to be 8.50%.

Types of EPF Forms

There are different types of EPF forms, the table given below shows all of the types:

Form no. Uses
Form 31  This form is used for the purposes like withdrawal of the money from the PF account, taking loans, and also for obtaining advance money from the PF account. This form is also identified as the PF Advance Form.
Form 10D The use of this form is for availing the benefits of a monthly pension.
Form 10C This form is used by the employee to get the benefits of the EPF, to be able to withdraw the amount he\she has contributed towards EPS.
Form 13  This form 13 is helpful with the transfer of the amount in the PF account from the previous job to the current job. This is to keep all the PF money in one account. 
Form 19  This type of form is useful for the final settlement of the EPF account.
Form 20 This form is used by the family member of the EPFO to withdraw the PF amount, in case the member passes away because of any reason.
Form 51F This form is to claim the benefits of EDLI, the nominee can use this form to claim these benefits.

Check EPF Account Balance

There are four different methods from which we can easily check the balance of an Employees’ Provident Fund account. Let us discuss these four methods:

  • The very first method is that you can log in through the EPFO portal, using UAN and password which will take you directly to your Employees’ Provident Fund account and you can check your balance and handle your account the way you want to.
  • If you do not always want to reach the EPFO portal and use it for checking your balance, the alternative to it is to use a mobile application which is the UMANG app. This is the second method to check your Employees’ Provident Fund balance. With the help of this app, you can not only check your balance but can also raise a claim and also can track the claim.
  • Another method is to use a service provided by the EPF is a missed call service. You can give a missed call from your registered mobile number to the number provided by the EPFO which is 011-22901406.
  • The last method here is using another service provided by the EPFO which is the SMS service, but you can only use this service if your UAN is working and is activated. To check your balance you can send an SMS to a number which is 7738299899.

EPFO Portal Login

If you want to log in yourself to the EPFO portal the very first step for this is to generate a UAN for yourself. Activating a UAN is very easy and can be done on the EPFO portal itself.

An employee can always log in to the Employees’ Provident Fund member portal using his\her UAN and password, whereas the employer can log in to the website as well, all it needs is a permanent ID and password for it.

When UAN is activated for an employee, he\she can log in to the portal, and the following activities can be after it:

  • Checking balance
  • Downloading his\her UAN card and passbook.
  • Can track the Employee’s Provident Fund transfer claim.
  • Can update personal information.
  • Can update the information of KYC, etc.

How to check the EPF passbook?

The EPFO member who has activated its UAN can access the Employees’ Provident Fund passbook without much hassle, it can be done through the EPFO portal. This EPF passbook facility can be used to check Employees’ Provident Fund statements, print or download these statements. The EPF passbook has several details of the employee such as name, establishment ID of the employee, details of the Employees’ Provident Fund scheme, etc.

Online withdrawal of EPF

Employees’ Provident Fund can be withdrawn online but partially and not completely and that partial withdrawal should be having some appropriate reason such as if the employee wants to buy a house, he\she wants funds for the marriage of children, or there is any medical condition for which the fund is required. The amounts withdrawn can not be the same for all the reasons, it depends on the reason for the withdrawal. The thing which needs to be noted is that there is a lock-in period for the partial withdrawal and this period also depends on the reason for the withdrawal.

The entire Employees’ Provident Fund amount can be withdrawn under some special circumstances. These circumstances are attaining the age of retirement, the resignation of the employee due to any mental or bodily dysfunction, moving permanently to another country, death of the EPFO member, etc.

EPF Claim Status

If an EPFO member has decided to withdraw its total amount of Employees’ Provident Fund because of some reason, he\she can log in to the EPFO portal and place an online request for the same. This claim can also be tracked through the same portal.

Another way to track the claim status is to give a missed call to a number 011-22901406 from the number that has been registered. The SMS facility for the same purpose can also opt. UMANG app can also be used for the same purpose.

EPFO Headquarter

As Employees’ Provident Fund Organization is a central level organization, and because of it being handled by the central government the headquarter for this organization is situated in the capital of India which is Delhi. The CEO of this organization at present is Mr. Sunil Barthwal.

PF Interest Rate

The Authorities of the Central Board of EPFO has recommended an interest rate of 8.5% for the financial year of 2020- 2021 for the subscribers of the EPF scheme. The EPFO decides this rate of interest yearly for the EPF scheme, this interest rate depends on the market conditions and is recommended by the Ministry of Finance.

 This interest rate can be calculated easily by either using a step method or by using a formula method. For this financial year, the interest rate will be 8.5%.

EPS Scheme 

The Employees’ Pension Scheme was launched in the year 1995 by the Employees’ Provident Fund Organization to provide help to the employees in the organized sector. This scheme was launched with the purpose to ensure that every employee, when reaches the age of 58 years receives the pension.

Every member of Employee’s Provident Fund whether new or old can take the benefits of this scheme. The 12% of the employees’ salary by the employee and the employer is contributed towards Employees’ Provident Fund. The complete share of employees is contributed to Employers Provident Fund, and from that share, 8.33% goes toward EPS. This scheme helps the retired people to have an income source even after their retirement.

EDLI Scheme

The Employees’ Deposit Linked Insurance is another scheme launched by the EPFO as an insurance cover for the members of the EPFO. This scheme works with the contribution of EPF and EPS. Under this scheme, if the member of the EPFO who was actively working, dies because of any reason, the legal nominee will get the approximate amount of Rs. 7 lakh as an insurance cover.

This scheme was launched in the year 1997 to provide financial help to the family of the member of EPFO in case the member dies during its working period. The amount of this insurance cover depends upon the salary drawn by the employee in the last 12 months.

Frequently Asked Questions

Q1. Is there any possibility of lessening the contribution of the employee towards EPF?
Ans. No, there are no such changes or any kind of possibility of lessening the contribution of the employees’ salary towards EPF.

Q2. Are there any age-related criteria for the employee to become a member of EPF?
Ans. No, there are no criteria regarding the age, an employee can become a member of EPF before attaining the age of 58 years, which means before getting retired.

Q3.  If an employee quits the job after that can he\she still contribute to EPF?
Ans. No, once the employee quits their job, there is not any possibility of him\her again be able to contribute towards EPF.

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