The Employees' Provident Fund (EPF) is administered by the EPFO under the EPF & Miscellaneous Provisions Act, 1952. Any establishment in India employing 20 or more persons must register and deduct EPF from eligible employees.
Contribution rates
Both the employee and employer contribute 12% of the employee's basic + DA. The employer's share is split:
- 8.33% to the Employees' Pension Scheme (EPS), capped on a wage of ₹15,000
- 3.67% to the EPF account
- 0.50% EDLI (Employees' Deposit Linked Insurance), capped at ₹75/month
- 0.50% EPF administration charges
The ₹15,000 wage ceiling
EPF eligibility is mandatory where Basic + DA ≤ ₹15,000/month. For employees earning above this, EPF becomes voluntary — but most employers continue to deduct to retain talent. EPS contribution from the employer side, however, is always capped at 8.33% of ₹15,000 = ₹1,250 regardless of actual salary.
Monthly ECR filing
Every month, employers must file an Electronic Challan-cum-Return (ECR) with EPFO detailing employee-wise wages and contributions. The challan is deposited via the EPFO portal by the 15th of the following month. Late filing triggers both damages and interest:
| Delay (days) | Damages (of contribution) | Interest |
|---|---|---|
| Up to 60 | 5% per annum | 12% per annum |
| 61–120 | 10% per annum | 12% per annum |
| 121–180 | 15% per annum | 12% per annum |
| Over 180 | 25% per annum (capped at 100%) | 12% per annum |
UAN and employee onboarding
Every EPF-eligible employee gets a Universal Account Number (UAN) — portable across jobs. When a new hire joins, the employer links their UAN to the company's establishment code via EPFO's Unified Portal. Failing to link or opening a duplicate account creates compliance headaches at withdrawal.
Voluntary Provident Fund (VPF)
Employees can top up their PF contribution beyond 12% via VPF. Employer contribution does not change. VPF earns the same interest as EPF (8.25% for FY 2023-24) and is tax-free on withdrawal after 5 years.
PF withdrawal and Form 10C/10D/19
EPF can be withdrawn on retirement, resignation for 2+ months, or partial withdrawal for medical, housing or marriage reasons. Full withdrawal before 5 years of continuous service is taxable. Most withdrawals today flow through the Unified Portal with UAN-based KYC — no employer signature required.
How Vergado handles EPF end-to-end
Vergado computes EPF contributions every cycle based on current wage ceilings, generates the ECR and EPS challan, and deposits it to EPFO automatically by the due date. It tracks UAN linking at onboarding, files KYC updates, and hands your finance team a clean audit trail — including damages and interest if a historic deposit needs reconciliation.
