Provident Fund registration, a social security scheme having the government guarantee is mandatory for the companies having 20 or more employees. A worker whether working in Government, Private or Public sector organization, who is drawing a salary of more than Rs 15,000, with the assent of the Employer, is required to be enrolled under the Employees’ Provident Fund (EPF) scheme managed by the Employees Provident Fund Organisation of India (EPFO) under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. However, employers with less than 20 employee, can also obtain Provident Fund registration on the voluntary basis.
Each month, an employee has to contribute 12% of his basic salary each, to the provident fund account. An equivalent commitment is payable by the worker. Contribution towards EPF is eligible for tax deduction under section 80C of Income Tax.
In case of companies having less than 20 employees, the contribution rate for both worker and the business is confined to 10%.
All organization with PF registration must file PF return on the 25th of every month. Further, it should file annual return before 30th April.
PF contribution is required to be deposited before 15th of each month. The business must deduct a sum of 12% or 10% of the worker salary towards PF at on or before this date every month. For most cases, the PF rate of 12% is applicable.
The EPFO has launched a Unified Portal to streamline and rearrange all aspects of PF for both employee and employer. After registration with EPFO, the establishment can allot UAN (Universal Account Number), a 12-digit employee identification number, to its each employee who contributes to the EPF.
Employees making regular PF contributions, can withdraw money from their PF account for different reasons by applying on the Unified Portal. PF can be withdrawn for buying a house, medical reasons, marriage or education of family members.
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