Higher EPFO pension: New form, eligibility, calculator details and guidelines – Explained
How to get higher EPFO pension: New form, eligibility, calculator details and guidelines – Explained
Latest news to know about EPFO Higher Pension form, circular, guidelines, calculator and how to get.
EPFO higher pension guidelines: The Employees’ Provident Fund Organisation (EPFO) has announced a new window for subscribers who couldn’t opt for higher pensions earlier. The EPFO’s new guidelines come just two weeks before the end of the four-month deadline set up by the Supreme Court to enable eligible subscribers to opt for higher pensions under EPS.
The employees now have the option to go for higher contributions towards EPS, which is currently capped at 8.33% of the maximum Rs 15,000 pensionable salary. In the new window, employees will have the option to let their employers deduct a sum equal to 8.33% of the actual basic salary towards the EPS pension.
Employees and employers will have the option to sign up a joint form requesting EPFO to deduct 8.33% of the actual monthly basic salary towards EPS. This will ensure the accumulation of a larger corpus and higher pension for employees.
What’s the issue?
The Central Government raised the pensionable salary cap under EPS to Rs 15,000 from Rs 6500 through an amendment in 2014. As per the changed rules, employers and members were required to contribute 8.33% of the actual salaries towards the scheme if it exceeded the cap. The EPFO then provided all EPS members with a six-month window to opt for the amended scheme for higher pension. However, several subscribers missed this opportunity. Hence, a new window has been provided based on a Supreme Court judgement in November last.
“…all the employees who did not exercise option but were entitled to do so but could not due to the interpretation on cut-off date by the authorities ought to be given a further chance to exercise their option,” the apex court said in its judgement dated November 4, 2022.
View: Instructions in compliance of orders contained in Para 44 (iii) & (iv) read with Para 44(v) of Hon’ble Supreme Court judgement dated 04.11.2022: EPFO Order 20.02.2023
Who can apply?
According to the EPFO circular dated 20th February 2023, the following employees along with their employers can submit the joint option to the concerned regional office –
- Employees and employers who had contributed on salary exceeding the wage ceiling of Rs 5,000 or Rs 6,500
- Employees and employers who did not exercise the joint option in the previous window while being EPS members
- Employees who were members before September 1, 2014, and continued to be a member on or after that date.
How to apply?
If you are an eligible subscriber, you will be able to exercise the joint option before the regional provident fund office on the joint option form.
View: Option for EPS 95 pensioners who had contributed under EPF Scheme: Corrigendum – EPFO Order in compliance of Supreme Court judgement dated 04.11.2022
It should be noted, however, that more details related to timelines of the application process will be provided by the Regional PF Commissioners soon. All applications will have to be digitally logged, for which a separate URL facility will be provided by the EPFO.
Meanwhile, the EPFO has laid out the following guidelines to be followed:
The request will be made in such form and manner, as may be decided by the Regional Provident Fund Commissioner.
The joint option will contain the disclaimer and declaration as may be specified theirein.
In case of share requiring adjustment from Provident Fund to pension Fund and if any redeposit to the fund, explicit consent of the employee will be given in the joint option form. ‘
In case of transfer of funds from exempted provident fund trust to pension fund of EPFO, an undertaking of the trustee shall be submitted. The undertaking shall be to the effect that due contribution along with interest up to the date of payment, will be deposited within the specified period.
In case of employees of unexempted establishments, refund of requisite employer’s share of contribution, the same shall be deposited with interest at the rate declared under para 60 of EPF Scheme, 1952, till the date of actual refund.
The join option must contain the proof of remittance of employer’s share in Provident Fund on higher wages exceeding the prevalent wage ceiling of Rs 5000/Rs 65000 and proof of joint option under Para 26 (6) of EPF Scheme duly verified by the employer.
The application will land into the employer’s login whose verification with Digital Signature/e-Sign will be essential for further processing.
The EPFO will issue a separate circular detailing the method of deposit and computation of pension.
EPF contribution rule
Currently, employees and employers contribute 12% of the employee’s basic salary and dearness allowance towards EPF. While the employee’s entire contribution goes towards EPF, the employer’s 8.33% contribution goes to EPS and 3.67% to EPF.
Read at: Financial Express