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All About Employee Provident Fund

July 7, 2018

Meaning:

Employee Provident Fund(EPF)is an employee benefit scheme generally prescribed by a statutory body of the Government which provides facilities to the employees of an organization.

With regard to

  1. Medical Assistance
  2. Retirement
  3. Education of Children
  4. Insurance Support
  5. Housing
  • Under the EPF scheme, an employee has to pay a certain contribution towards the scheme and an equal contribution paid by the employer.
  • The employee gets a lump sum of amount including self and employer’s contribution with interest on both, on retirement.
  • As per the rules, in EPF, an employee whose ‘pay’ is more than Rs. 15,000 per month at the time of joining, is not eligible and called non-eligible employee.
  • Employees drawing less than Rs 15000 per month have to mandatorily become members of the EPF.
  • However, an employee who is drawing ‘pay’ above the prescribed limit (at present Rs 15,000) can become a member with permission of Assistant PF Commissioner, if he and his employer agree.

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Contribution by Employer and Employee

The contribution paid by the Employer is 12% of Basic Wages plus Dearness Allowance plus Retaining Allowance. An equal contribution is payable by the employee also.

In the case of establishments which employ less than 20 employees, as per the EPFO rules, the contribution rate for both employee and the employer limited to 10 percent.

For most employees of the private sector, it’s the basic salary on which the contribution is calculated.

For example, if the monthly basic salary is Rs 30,000, the employee contribution towards his or her EPF would be Rs 3,600 a month ( 12 percent of basic pay) while the equal amount is contributed by the employer each month.

Meaning of Employee Provident Fund Account Number

According to the 1952 Act, any company with over 20 employees require to register with the EPFO.

The PF number format is specific comprising of the following; Region/ Office/ Establishment Code/ Ext/ PF Number

Note: If 3-digit extension number is not available, you need to put it as ‘000’

Example of PF Number: MH/BAN/54321/000/2327999.

Ways to Check PF Balance:

  • Check PF Balance by Missed Call
  • Check PF balance through SMS facility
  • Online PF Balance Check with UAN Number
  • Checking PF Balance using Umang App
  • Checking PF Balance in Mobile App.

UAN & Provident Fund Number

The UAN is a 12-digit unique number that has given to every PF member.

Before the introduction of the UAN, employees were inconvenienced by the fact that they have to keep shifting their accounts when they shift organizations.

But now, the UAN controls all PF accounts of an employee and it can function as one account.

The UAN has made almost all the processes of the EPF easier and convenient.

The process to Generate and Activate UAN by Employer

If the employer has not shared the UAN with the employee, the following procedure can be used:

  • Log on to the EPFO website and select the option “Know Your UAN Status”
  • Enter the details of the PAN or Aadhaar and submit them to receive an authorization pin.
  • An OTP will send to the mobile number entered in the form and would enter in the space provided.
  • The UAN and the status of the UAN will then send to the employee’s mobile number.
The following steps should follow to activate the UAN:
  • Log in to the official EPFO website and select the “Activate UAN” option
  • UAN Activation can be done either through UAN, PAN or Aadhaar.
  • After selecting one of the three option mentioned above, enter personal details including the mobile number.
  • A verification PIN will send to the mobile number. Once entered, select the “Authorize and Activate” option.
Documents required to generate UAN
  • Bank account info-account number, IFSC code, branch name.
  • ID Proof – Any photo-affixed and national identity card like Driving License, Passport, Voter ID, Aadhaar, SSLC Book
  • Address Proof: A recent utility bill in your name, rental/lease agreement, ration card or any of the ID proof mentioned above if it has your current address
  • Pan Card– Your PAN Number should link with UAN.
  • Aadhar Card –  SInce Aadhaar is linked to the bank account and mobile number, it is mandatory.
  • ESIC card.

Benefits of UAN

Listed below are the benefits of UAN and the changes that it has brought about to the EPF processes:

  • Subscribers can merge up to 10 PF account in one go using the UAN. For this to happen, the subscriber will be first required to seed his/her Aadhaar card details to the UAN.
  • Subscribers can carry out the auto-transfer process of their PF accounts using UAN.
  • PF members can make transfers, check PF balance, make a contribution or withdrawal using the UAN.
  • Once the subscribers’ details are seed with the UAN, he/she will receive a notification message every time a contribution or withdrawal has been made.
  • Apply for PF transfer online.

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