Employee Provident Fund
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Employee Provident Fund
The employee provident fund (EPF) is an employee saving scheme that allows workers who earn salaries working for the government or private establishment to get financial aid from the proceeds of their savings. The employee’s provident fund and miscellaneous provision act guide the registration of workers for the EPF scheme.
The act specifically provides that any company having more than twenty employees would be covered under the act. Also, the act shall continue to apply to an establishment even if their staff falls below twenty if such a company is covered under Schedule 1 of the act.
The scheme is essentially a welfare scheme for workers. It ensures that workers get tax free benefits from the proceeds of their income. The worker salary is invested over a while, and it is later claimed to meet different needs including insurance, retirement, housing, etc.
PF registration for Employer is compulsory for:-
- All factories or establishments having 20 or more people
- The class of such organizations whom the Central Government may, by notice would specify for compulsory EPF employer registration.
- The employer will collect an amount by deducting it from your monthly remuneration, both employee and the organization contributes 12% of the basic remuneration into the EPF account. This salary includes any dearness allowance provided by the company and interest on pf is tax exempted.
- All individuals earning a salary of Rs 15,000 and above have to register under the EPF scheme.
- Universal Account Number (UAN) is a 12-digit number that the Employee Provident Fund Organisation (EPFO) provides to an employee. UAN of an employee remains the same throughout life irrespective of the number of jobs he/she changes.
- Every time an employee switches job, EPFO allots a new member identification number (ID), which will be linked to the UAN. You can get a new member ID by submitting the UAN to the new employer. Once the member ID is created, it gets linked to the UAN of the employee.
- But, in case you do not wish to be registered under the EPF scheme, you have to opt- It is recommended that you do not remove the account for future benefits. It might increase your in-hand salary, but you have to build your future cash reserve in other ways.
Documents Required
- PAN Card of the company
- COI, MOA & AOA of the company
- Labour certificate copy
- Cancelled cheque
- Passport size photo of all the Directors
- List of names of the employees
- Proof of Address(Power bill, Municipal tax bill, Sale deed copy)
Registration Duration
Registration/ coverage of EPF takes the shortest time and can be completed within a min. of 1-3 working days. Despite registration taking the shortest time possible, this solely depends on government procedures and approvals during the time of your registration.
