Provident Fund (PF): Provident fund is an investment made by the employee during his work life along with contribution from employer to secure future. Information and details relating to GPF, EPF, and their applicability can be viewed here. On application of the Provident Fund Act to an establishment, the employer may seek exemption from the operation of Provident Fund Scheme or Pension Scheme or Employees’ Deposit Linked Insurance Scheme or from all.
- Provident Fund is a Social Security Benefit to employees.
- It is a compulsory saving by an employee during his employment.
- It is meant for old age.
- This is required to be availed on retirement/cessation from service.
- An employee who contributes to Provident Fund is also eligible to receive a matching contribution from his employer.
Quick Links
Employees’ Provident Fund Act / Scheme
- Employees’ Provident Fund is set up under the Central Act viz. Employees’ Provident Funds & Miscellaneous Provisions Act, 1952, in the year 1952.
- It is applicable throughout the country (except Jammu & Kashmir).
- It is applicable to almost all establishments falling under the industries/class of establishments, wherein 20 persons are employed.
- In the case of cinema theatres workers, it is applicable to such establishments wherein 5 persons are employed.
- Benefits to an employee are provided through the schemes framed under the ‘Act’.
- Provident Fund benefits are provided under the Employees’ Provident Funds Scheme, 1952.
- Pension benefits are provided under the Employees’ Pension Scheme, 1995.
- Insurance Benefits are provided under the Employees’ Deposit Linked Insurance Scheme, 1976.
- A member of Employees’ Provident Fund is automatically eligible for Pension and Insurance benefits without paying any additional amount of contribution.
Employees’ Provident Fund Organisation(EPFO)
- Employees’ Provident Fund Organisation (EPFO) is administering the above Schemes.
- Employees’ Provident Fund Organisation is a statutory body under the Ministry of Labour, Government of India.
- It is an all India Organisation having its offices in all State Capitals, Cities, Towns and Districts.
- he Employees’ Provident Fund is administered by Central Board of Trustees – Employees’ Provident Fund.
- The Central Board of Trustees, Employees’ Provident Fund consist of representatives from Employees’ Association, Employers Association and Central/State Governments.
- Honorable Minister for Labour, Government of India is the Chairman of Central Board of Trustees, Employees’ Provident Funds.
- The Chief executive of the organisation is the Central Provident Fund Commissioner, New Delhi.
- The Regional Provident Fund Commissioners are in charge of the Regional/ Sub- Regional/Sub-Accounts offices and monitor the compliance from all the establishments.
- Regional Provident Fund Commissioners are maintaining the Provident Fund accounts and ensure collection of dues from employers and extending of various benefits to the Employees/Family members/Nominees.
Special Features of the Act / Schemes
- Employees’ Provident Fund as also Provident Fund of exempted establishments is a recognized Provident Fund under the Indian Income Tax Act, 1961.
- An employee is eligible to avail the rebate on Income Tax on his Provident Fund Contributions subject to ceiling prescribed under the Income Tax Act.
- Non-payment of Employees’ Provident Fund dues by an employer may lead to recovery action by Regional Provident Fund Commissioners such as Prosecution, attachment of Bank Account/Property, arrest and detention etc
- Non-payment of employees’ contributions recovered from the wages of the employees would constitute ‘Criminal breach of trust’ punishable under Section 406/409 IPC.
- Employees’ Provident Fund dues paid after the due date (15th of the following month) will result in payment of interest u/s 7Q & penal damages u/s 14B by the employer.
- Employees’ Provident Fund account of an employee can be transferred to any place in the country. However, with the recent allotment of Universal Account Numbers to the employees by the Organisation, the need of transfer of funds will not be required in the near future. However, presently the transfer claims have to be filed online through the OTCP portal/Member’s UAN of EPFO.
- Employees’ Provident Fund may be withdrawn partially for certain specified purposes such as housing, marriage, illness, etc.
- All Provident Fund Claims of the member are to be disposed by EPF Offices within 30 days.
- Members are given the benefit of filing Nomination for Provident Fund/Pension and Employees’ Deposit Linked Insurance.
- The annual Employees’ Provident Fund balance is informed to every employee by the Employees’ Provident Fund Office. With the advent of online compliances, annual account slips in Form 23 are now being issued online on the employer’s portal. The member’s can also view their updated EPF pass books online through their UAN Login.
Recommended
