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EPF – FAQ

What is EPF?

EPF is Employees Provident Fund. Both the Employee and the Employer contribute
to this fund.

Who manages the Fund?

This is a Fund maintained by the EPF Organisation. The Central Board of Trustees
(CBT) of this organization is the body which controls this organization. It has
representatives of Employees, Employers and the Government. The fund is managed by
the CBT.

Is it safe?

It is absolutely safe as it is managed by the tripartite body as mentioned above.

How much one can contribute?

One can contribute generally @ 12% of one’s emoluments. However if one is


employed in brick, beedi, jute, guar gum factories and coir industry other than spinning
sector the rate of contribution is 10%. [Emoluments include basic wages, dearness
allowance, cash value of food concession and retaining allowances, if any.] Though this
is the statutory limit, one can contribute more than this rate also. The percentages of 12%
and 10% of the emoluments are subject to a ceiling of Rs 6500/-. That is, if the
emoluments per month is upto Rs 6500/-, the contribution will be 12 or 10% of that
amount. If the emoluments are more than Rs 6500/-, then the contribution amount will
be restricted 12 or 10% of Rs 6500/-. The Employer also will contribute at an equal rate
of 12% or 10% as the case may be. This contribution is also subject to the ceiling or Rs
6500/- as explained.

What are the benefits from the fund?

There are three benefits to the members of the fund. One is the benefit of Provident
fund saving with interest. Second is pension. The third is deposit linked insurance.

If one becomes the member of EPF he automatically becomes the member of


Employees Pension Scheme 1995 as well as the Employees Deposit Linked Insurance
Scheme 1976 (EDLIS). The entire contribution of the employee and 8.33% of the
contribution of the employer will go to the EPF. This will fetch annual interest. The rate
of interest varies from year to year depending upon the earning of the Fund.

The balance contribution of the employer will go to the Employees Pension Fund.
The central Government also contributes at the rate of 1.16% to the Pension Fund. The
employee need not contribute anything to the Pension Fund.
The employer will contribute 0.5% of the emoluments to the EDLIS. Employees are
not required to contribute to the EDLIS.

How to know the balance in the fund?

The balance in the EPF can be seen from the annual account slip issued by the EPFO
to each member.

How to take advance?

One can withdraw some amount from his EPF for some specific purposes only. The
purposes for which such withdrawals and loans can be availed and other conditions are as
follows:

Advance/ Withdrawals may be availed for the following purposes :

• Marriage / Education

• Treatment

• Purchase or construction of Dwelling house

• Repayment of Housing Loan

• Purchase of Plot

• Addition/Alteration of House

• Repair of House

• Lockout

• Withdrawal Prior to Retirement

• Other Advances
• Notes

For Marriage / Education

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para For the marriage of: Should 50% of Apply in Form-31
68-k of the complete Employee through the
Scheme atleast 7 share at the Employer
1. self years of time of
2. son, daughter service. tendering Bonafide
the Certificate duly
3. brother, sister
3 times in application indicating the fees
the entire payable from the
For education of :
service educational

o self institution

o son, Marriage

daughter invitation card


along with the
application should
be submitted
through the
employer

For Treatment

Type of Purpose Eligibility Maximum Proof/


Advance Admissible documents
Amount** required
Under Para For the treatment of : • No 6 times of Certificates of
68-j of the minimum Wages proof as
Scheme 1. self service mentioned in
required OR the eligibility
2. Hospitalisation column
• Certificate
for 1 month or Full of
Whenever from ESI
more Employee Apply in
required for or from
1. major Employer share Form-31
treatment surgical that the (whichever is through the
operatio ESI facility less) Employer
n in a are not
hospital available
2. suffering to the
from TB, member
leprosy, • a doctor
paralysis [ or
, cancer, registered
mental medical
derange practitione
ment or r] of the
heart hospital
ailment certifies
and that a
having surgical
been operation
granted or
leave by hospitalisa
his tion for 1
employer month or
for the more
treatmen is/was
t of said necessary
illness
• In case of
TB,
leprosy ...
2. family( spouse, etc., a
son, daughter, specialist
dependent doctor
father, mother) should
certify
1. major
surgical
operatio
n in a
hospital
and 1
month or
more
hospitali
sation for
the
operatio
n

2. suffering
from TB,
leprosy,
paralysis
, cancer,
mental
derange
ment or
heart
ailment

For the construction/ purchase of dwelling unit (house/ flat)


Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
For the • Should Declaration in the
construction/ complete Proforma
purchase of 5 Years obtained along
dwelling unit of with application
(house/ flat) service signed by
Under Para 68-B • Only Member
of the Scheme once in
service Apply in Form-31
• property through Employer
should
Only Once (either
be in the
'construction or
name of 36 times of
purchase of
self or Wages
house' or
spouse
'repayment of
or jointly
housing loan)

• should
not be a
Apply in Form-31 joint
property
owned
by other
than the
spouse

Repayment of housing loan

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para 68- Repayment of • Should complete 36 times of Declaration in
BB of the housing loan 10 Years of Wages the Proforma
Scheme service obtained with

• Only once in approval and

service signed by the


Only Once Member
• property should
(either
Apply in Form-
'construction or be in the name 31 through the
purchase of of self or spouse Employer
house' or or jointly
'repayment of
housing loan) • should not be a
joint property
owned by other
Apply in Form- than spouse
31

For the purchase of site/ plot

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para For the 24 times of Filled-up
68-B of the purchase of • Should complete Wages Declaration(from
Scheme site/ plot 5 Years of the Employee in
service the prescribed
• Only once in form and
Only Once service enclosed with the
• property should application.
be registered in
the name of self Copy of the
or spouse or Purchase
jointly Agreement

• should not be a
joint property
owned by other Apply in Form-31

than spouse through the


Employer

Addition/alteration of house
Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para Addition/alteration • Should complete 12 times of Certificates of
68-B(7) of of house 5 Years after Wages proof
the Scheme (same type of construction
advance can be • Annexure III Apply in
availed for repair of (construction / Form-31
Only Once house) completion through the

certificate/ Employer

Apply in utilisation

Form-31 certificate) should


be submitted
• Only once in
service
• property should
be in the name of
self or spouse or
jointly

• should not be a
joint property
owned by other
than spouse

Repair of house

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para Repair of • Should complete 12 times of Certificates of
68-B(7) of the house 10 Years after Wages proof
Scheme (same type of construction
advance can • Annexure XIII Apply in Form-
be availed for (construction 31 through the
Only once alteration of completion Employer
house) certificate) should
be submitted
• Only once in
service
• property should
be in the name of
self or spouse or
jointly

• should not be a
joint property
owned by other
than spouse

Lockout or closure of the establishment

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para 68- Lockout or • No minimum equivalent to Declaration
H of the closure of the service the total of
Scheme establishment • should be closed wages Apply in Form-

for more than 15 multiplied by 31

days no. of months


Whenever closed
• Wages for
need arises
atleast 2 months
is not paid

• Balance should
be there in
Employee's
share. If closed
for more than 6
months,
advance can be
allowed from
Employer's
share also

Withdrawal prior to retirement

Maximum Proof/
Type of
Purpose Eligibility Admissible documents
Advance
Amount** required
Under Para 68- Withdrawal • No minimum 90% of total of Certificate from
NN of the prior to service both shares the employer
Scheme retirement • atleast 54 showing the

years of age date of


retirement
Only once
• 1 year before
retirement Apply in Form-
31

Other Advances

68L : ADVANCE IN ABNORMAL CONDITIONS

Documentary
Types of Benefit Eligibility Eligible Amount Form
Support
Grant of advance · Certificate of Rs. 5000/- or 50% of No.31 Certificate from the
in abnormal damage from member’s own share Appropriate
conditions, Natural appropriate of contribution (To Authority.
calamities etc. authority. apply within 4 months)

· State Govt.
declaration.

68 M : ADVANCE TO MEMBER AFFECTED BY CUT IN THE SUPPLY OF


ELECTRICITY

Types of Eligible Documentary


Eligibility Form
Benefit Amount Support
Grant of The advance may be granted Wages for No.31 Certificate from State
advance to only to a member whose total a month Govt. regarding cut
members wages for any one month OR in the supply of
affected by cut commencing from the month of Rs.300/- electricity.
in the supply of January 1973 were 3/4th or
electricity less than 3/4th of wages for a
month

68 N : GRANT OF ADVANCE TO MEMBERS WHO ARE PHYSICALLY


HANDICAPPED

Eligible Documentary
Types of Benefit Eligibility Form
Amount Support
To Physically Production of Basic wages+ No.31 Certificate from the
Handicapped medical certificate DA for six Medical practitioner
member for from a competent months to the effect that the
purchase of an medical practitioner or own share of member is physically
equipment required to the effect that he contribution with handicapped..
to minimize the is physically interest or cost
hardship on account handicapped of equipment
of handicap. which ever is
least.

**Notes
· The amount of advance/withdrawal is not required to be refunded under normal
circumstances. If the amount is not utilised, the same should be refunded with penal
interest

· A fixed minimum balance in the account will be kept before arriving at the amount of
advance admissible subject to the above conditions

· For calculation/ computing the period of membership U/P 68B, 68BB, 68K, total
service exclusive of periods of break under the same employer before the scheme is
applied to him, as well as period of membership of the fund is always included

How to withdraw the entire balance?

Withdrawal of the entire balance or final settlement can be made on certain events. In
some cases the application for it can be made immediately and in certain cases after two
months of the event. These are as below:-

SETTLEMENT UNDER PARA 69-TO MEMBER:

THROUGH FORM No.19

Immediate settlement without Settlement only after a waiting


waiting period of 2 months period of two months
69(1)(e)(i) transfer of a non retrenched
69(1)(a) Retirement after attaining 55
employee from a closed establishment to
years of age.
uncovered establishment.
69(1)(b) Retirement on account of total 69(1)(e)(ii) Transfer of an employee from a
and permanent incapacity due to bodily covered establishment to an un-covered
or mental infirmity . establishment under the same employer.
69(1)(d) Termination of service on 69(2) Other cases viz. Resignation, Leaving
retrenchment. service, etc.
Note: For female members leaving service for
69(1)(dd) Termination on V.R.S the purpose of getting married; waiting period
not applicable.
69(1)(c) Migration from India for 69(1)(e)(iii) Members discharged &
permanent settlement abroad or taking retrenchment compensation paid under I.D. Act
employment abroad. 1947.

Can it be transferred?
Yes, the fund can be transferred on certain occasions, such as when an employee
leaves one job and joins another. In such cases a new account number is allotted. The old
balance can be transferred to the new account. Apply in From-13(R) through the NEW
Employer at the EPF Office from which transfer is sought. Clearly state New and Old EPF
Numbers. New EPF Number will be allotted by New Employer. Not by EPFO.

Should one transfer or close?

It is always better to transfer the account rather than closing. After it is our saving
which will help us in times of providence.

What benefits are available under the EDLIS?

Assurance Benefit :
The benefit provided under the Employees' Deposit Linked Insurance Scheme is called
Assurance Benefit. On the death of the member while in service, the nominee or any
other person entitled to receive the Provident Fund benefits will, in addition to the
Provident Fund, receive the Assurance Benefit under Employees' Deposit Linked
Insurance Scheme .

Scale of Assurance Benefit :


From 1-4-93 onwards the amount of Assurance Benefit payable is an amount equal to the
average balance in the amount of deceased in the Fund during the preceding 12 months or
during the period of his membership whichever is less, except where the average balance
exceeds Rs. 25,000/- amount payable shall be Rs. 25,000/- plus 25% of the amount in
excess of Rs.25,000/- subject to a selling of Rs. 35,000/-. The Form prescribed for
claiming the Assurance Benefits under the Employees' Deposit Linked Insurance
Scheme, 1976 , is Form 5(IF).

* w.e.f. 24.6.2000 the amount of benefits has been increased to 60,000/-

Who can become a member of EPF?

Every employee (including part-time workers and those employed by or through


contractors) shall be entitled to become a member of the Scheme from the date of joining
the factory or the other establishment. (Para 26)

Every newspaper employee other than an excluded employee shall be entitled to become
member of the Fund after completion of 3 months continuous service or if he has
actually worked for 60 days during 3 months or less (There is no wage ceiling in the case
of newspaper employee). (Para 80)
Every Cine Worker other than an excluded employee shall be entitled to become a
member of the Fund if he has worked in not less than three feature films with one or more
producers provided his pay at the time of joining the Fund does not exceed Rs. 1600/-
P.M or Rs.15,000/- per year. (Para 81)

What are the responsibilities of the employer?

The employer has the following responsibilities:

• Enrol all categories of employees including the employees engaged by


or through contractors and also piece rated, hourly rated employees.
• Remit the contributions and administrative charges before the 15th of the
following month.
• File the initial returns of Form 9, Form 3(P.S.), form 5A.
• File the monthly returns in Form 12A, Form 5, Form 10 and Challans for
remitting the dues.
• Maintain the contribution card in respect of each employee in Form 3A and
submit the annual returns in Form 3A and 6A after reconciliation with Challans
and form 12A.
• The employer has to ensure that statutory dues in respect of contractors
employees are remitted and returns filed.
• Employer should attest the form No.2 and the claims forms submitted by the
member/ legal heirs/ nominees.
• Make available all relevant records for inspection of visiting officials with due
authorisation.

What if the company is closed or if the employer refuses to cooperate?

If the company is closed and the employer is either not traceable or refused to sign the
subscriber to the fund can still submit his claim for settlement through other means. It is
the duty of the employer under the Act & Scheme to help Employees' Provident Fund
organisation to settle the Provident Fund dues of his employees. He has to complete the
prescribed application within 5 days of receipt [para72(5)] forms & hand over it to the
member when he leaves the service. When a member finds it difficult to get the form
attested by the employer, he can get the attestation of any of the following officer & send
to the Provident Fund office:

1. Manager of a bank.
2. By any gazetted officer.
3. Member of the Central Board of Trustees./ committee/ Regional Committee
(Employees'
Provident Fund Organization).
4. Magistrate/ Post/ Sub Post Master/ President of Village Panchayat/ Notary
Public.

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