{"id":9929,"date":"2022-08-23T16:00:32","date_gmt":"2022-08-23T10:30:32","guid":{"rendered":"https:\/\/www.tickertape.in\/blog\/?p=9929"},"modified":"2023-05-01T16:41:35","modified_gmt":"2023-05-01T11:11:35","slug":"pf-contribution-break-up-and-how-to-calculate-it","status":"publish","type":"post","link":"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/","title":{"rendered":"PF Contribution Break Up and How To Calculate It"},"content":{"rendered":"\n<p>Provident Fund (PF) is a government-backed <a href=\"https:\/\/www.tickertape.in\/blog\/saving-schemes-in-india-interest-rates-and-tax-benefits\/\" data-type=\"post\" data-id=\"9340\">saving scheme<\/a> to encourage government and private organisations\u2019 employees to save for retirement. The monthly contributions to the PF are deposited at the Employee Provident Fund Organisation (EPFO).\u00a0<\/p>\n\n\n\n<p>There are three parts to the PF: <a href=\"https:\/\/www.tickertape.in\/blog\/interest-on-pf\/\" data-type=\"post\" data-id=\"5906\">Employees\u2019 Provident Fund (EPF<\/a>), Employee Pension Scheme (EPS) and <a href=\"https:\/\/www.tickertape.in\/blog\/employees-deposit-linked-insurance-scheme\/\">EDLI<\/a> (Employees Deposit Linked Insurance Scheme). In the Employees\u2019 Provident Fund (EPF), the contributions are made by both the employer and the employee. While in EPS and EDLI, only the employer contributes towards the PF. In this article, learn more about PF contribution break up and how to calculate it.\u00a0<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_66_1 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#PF-contribution-break-up\" title=\"PF contribution break up&nbsp;\">PF contribution break up&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#Key-points-of-PF-contribution-break-up-%E2%80%93-employer\" title=\"Key points of PF contribution break up &#8211; employer&nbsp;\">Key points of PF contribution break up &#8211; employer&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#Key-points-of-PF-contribution-break-up-%E2%80%93-employee\" title=\"Key points of PF contribution break up &#8211; employee&nbsp;\">Key points of PF contribution break up &#8211; employee&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#How-to-calculate-PF-contribution\" title=\"How to calculate PF contribution?&nbsp;\">How to calculate PF contribution?&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#FAQs\" title=\"FAQs\u00a0\">FAQs\u00a0<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#1-Is-it-mandatory-for-the-employer-to-contribute-towards-the-EPF-of-an-employee\" title=\"1. Is it mandatory for the employer to contribute towards the EPF of an employee?\u00a0\">1. Is it mandatory for the employer to contribute towards the EPF of an employee?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#2-What-is-the-employer-contribution-to-PF\" title=\"2. What is the employer contribution to PF?\u00a0\">2. What is the employer contribution to PF?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#3-What-is-the-employees-contribution-to-PF\" title=\"3. What is the employees\u2019 contribution to PF?\u00a0\">3. What is the employees\u2019 contribution to PF?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#4-What-is-the-pension-contribution-in-PF\" title=\"4. What is the pension contribution in PF?\u00a0\">4. What is the pension contribution in PF?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#5-Is-the-employers-contribution-to-PF-taxable\" title=\"5. Is the employers\u2019 contribution to PF taxable?\u00a0\">5. Is the employers\u2019 contribution to PF taxable?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#6-What-is-the-minimum-PF-contribution\" title=\"6. What is the minimum PF contribution?\u00a0\u00a0\u00a0\">6. What is the minimum PF contribution?\u00a0\u00a0\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.tickertape.in\/blog\/pf-contribution-break-up-and-how-to-calculate-it\/#7-What-is-the-maximum-PF-contribution\" title=\"7. What is the maximum PF contribution?\u00a0\">7. What is the maximum PF contribution?\u00a0<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"PF-contribution-break-up\"><\/span><strong>PF contribution break up&nbsp;<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Here\u2019s a table of PFs and their contribution percentage from the employees and employers.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Contribution towards<\/strong><\/td><td><strong>Employee&#8217;s contribution (in %)<\/strong><\/td><td><strong>Employer&#8217;s contribution (in %)<\/strong><\/td><\/tr><tr><td>EPF<\/td><td>10 or 12<\/td><td>3.67<\/td><\/tr><tr><td>EPS<\/td><td>&#8211;<\/td><td>8.33<\/td><\/tr><tr><td>EDLI<\/td><td>&#8211;<\/td><td>0.5<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<ul><li>The employee\u2019s contribution of 12% of the monthly salary is deposited in the provident fund account.<\/li><li>The employer\u2019s contribution of 12% includes 3.67% of EPF and 8.33% of EPS.<\/li><li>Along with the EPF and EPS, the employer must contribute an extra 0.5% to the EDLI.&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Key-points-of-PF-contribution-break-up-%E2%80%93-employer\"><\/span><strong>Key points of PF contribution break up &#8211; employer&nbsp;<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>As per the Employees Provident Fund Act, 1952, organisations with more than 20 employees are allowed to provide EPF to their employees with a monthly salary of more than Rs. 15,000. However, organisations with less than 19 employees can voluntarily join PF.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Key-points-of-PF-contribution-break-up-%E2%80%93-employee\"><\/span><strong>Key points of PF contribution break up &#8211; employee&nbsp;<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The minimum PF contribution of an employee is 12%. However, there are a few cases where the employee can contribute 10%:&nbsp;<\/p>\n\n\n\n<ul><li>Organisations with a maximum of 19 employees.<\/li><li>Organisations with an annual loss as compared to their <a href=\"https:\/\/www.tickertape.in\/blog\/net-worth\/\">net worth<\/a>.<\/li><li>Organizations with a pay limit of Rs. 6,500.<\/li><li>Industries such as guar, coir, gum, brick, jute and beedi.<\/li><li>If the Board for Industrial and Financial Reconstruction (BIFR) classified the organisation as ill.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How-to-calculate-PF-contribution\"><\/span><strong>How to calculate PF contribution?&nbsp;<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The calculation of PF is simple and calculated using your basic salary. Let\u2019s consider an example to understand the calculation better. Your basic salary is Rs. 25,000 (including <a href=\"https:\/\/www.tickertape.in\/blog\/what-is-dearness-allowance\/\">dearness allowance<\/a>).&nbsp;<\/p>\n\n\n\n<ul><li>Employee\u2019s <a href=\"https:\/\/www.tickertape.in\/blog\/how-good-is-the-cut-in-your-epf-contribution\/\">EPF contribution<\/a>: 12% of Rs. 25,000 = Rs. 3,000 per month.&nbsp;<\/li><li>Employer\u2019s EPS contribution: if the salary is less than Rs. 15,000 then 8.33% of the salary is taken. If the salary is more than Rs. 15,000, a fixed amount of Rs. 1,249.50 is contributed by the employer to EPS. Along with the fixed amount, 8.33% of the salary is calculated, subtracted from the fixed EPS amount and added the result is added to the EPF.&nbsp;<\/li><\/ul>\n\n\n\n<p>In our case, 8.33% of Rs. 25,000 is Rs. 2,082.50, so 2,082.50 &#8211; 1,249.50 = Rs. 833, which is the excess amount in EPS. It is transferred to the EPF account by the employer.&nbsp;<\/p>\n\n\n\n<ul><li>Total employer\u2019s contribution to EPF: 3.67% of the salary + excess from EPS = Rs. 917.5 &#8211; Rs. 833 Rs. 1,750.50 monthly.<\/li><li>Overall, total EPF contribution is = employee\u2019s contribution + employer\u2019s contribution Rs. 3,000 + Rs. 1,750.50 = Rs. 4,750.50.&nbsp;&nbsp;<\/li><\/ul>\n\n\n\n<p>You can use your <a href=\"https:\/\/www.tickertape.in\/blog\/uan-universal-account-number\/\" data-type=\"post\" data-id=\"9314\">UAN (Universal Account Number)<\/a> to log into your EPFO account and check the account balance and the contributions made to date.\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"FAQs\"><\/span><strong>FAQs<\/strong>\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n<div id=\"rank-math-faq\" class=\"rank-math-block\">\n<div class=\"rank-math-list \">\n<div id=\"faq-question-1661249976691\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"1-Is-it-mandatory-for-the-employer-to-contribute-towards-the-EPF-of-an-employee\"><\/span>1. <strong>Is it mandatory for the employer to contribute towards the EPF of an employee?\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes. All the employees registered with EPFO must contribute towards the EPF of the eligible employees.\u00a0<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661249984179\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"2-What-is-the-employer-contribution-to-PF\"><\/span>2. <strong>What is the employer contribution to PF?<\/strong>\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The employer\u2019s monthly contribution towards PF is 3.67% for Employees Provident Fund and 8.33% for Employee Pension Scheme.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661249986645\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"3-What-is-the-employees-contribution-to-PF\"><\/span>3. <strong>What is the employees\u2019 contribution to PF?<\/strong>\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The employees\u2019 monthly contribution towards PF is 12% of their basic monthly salary.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661249994646\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"4-What-is-the-pension-contribution-in-PF\"><\/span>4. <strong>What is the pension contribution in PF?\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>In the PF contributions, only the employer contributes towards pension, i.e., EPS. The contribution towards a pension in PF is 8.33% of the employee\u2019s monthly salary.\u00a0<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661250002536\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"5-Is-the-employers-contribution-to-PF-taxable\"><\/span>5. <strong>Is the employers\u2019 contribution to PF taxable?\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The employer\u2019s contribution towards PF is tax-exempt. However, if the amount is more than Rs. 7.5 lakh then it is taxable.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661250011312\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"6-What-is-the-minimum-PF-contribution\"><\/span>6. <strong>What is the minimum PF contribution?\u00a0<\/strong>\u00a0\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>For employers, the minimum PF contribution is 12% which can be extended voluntarily. For the employees, the minimum PF contribution is 12%.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1661250019447\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"7-What-is-the-maximum-PF-contribution\"><\/span>7. <strong>What is the maximum PF contribution?\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Currently, in the EPF the maximum PF contribution is 12% by the employee and employer each. However, employees can contribute more towards the PF account voluntarily.\u00a0<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>There are three parts to the PF: Employees\u2019 Provident Fund (EPF), Employee Pension Scheme (EPS) and EDLI (Employees Deposit Linked Insurance Scheme). In the Employees\u2019 Provident Fund (EPF), the contributions are made by both the employer and the employee. While in EPS and EDLI, only the employer contributes towards the PF. <\/p>\n","protected":false},"author":136,"featured_media":9933,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"_lmt_disableupdate":"no","_lmt_disable":"","footnotes":""},"categories":[1739],"tags":[],"acf":[],"modified_by":"Komal Roy","jetpack_featured_media_url":"https:\/\/www.tickertape.in\/blog\/wp-content\/uploads\/2022\/08\/PF-Contribution-Breakup.jpg?wsr","_links":{"self":[{"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/posts\/9929"}],"collection":[{"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/users\/136"}],"replies":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/comments?post=9929"}],"version-history":[{"count":5,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/posts\/9929\/revisions"}],"predecessor-version":[{"id":9935,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/posts\/9929\/revisions\/9935"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/media\/9933"}],"wp:attachment":[{"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/media?parent=9929"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/categories?post=9929"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.tickertape.in\/blog\/wp-json\/wp\/v2\/tags?post=9929"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}