EPF Compliance - PF Return Filing
Provident fund has the sole purpose of encouraging savings among employees to benefit them during their retirement. It is a social security system introduced for the employer and the employee to make monthly contributions. Provident Fund contributions can only be withdrawn by the employee at the time of his/her retirement, barring a few exceptions. All employers having PF registration are responsible for filing returns monthly. The Provident fund return filing must be done on or before the 25th of every month. Here we have explained the filing of provident fund returns and the various forms through which the purpose must be fulfilled. Employers can now easily file PF returns through the Unified Portal. PF returns must be filed every month by employers having PF registration in India.
It usually takes 2 to 3 working days.
- Preparation of Salary/Wages Register
- Bulk PAN Verification
- Challan Verification
- Online Challan Generation and Submission
- Filing of EPF Return
- Purchase of plan
- FIll in the details in the template provided
- Upload documents on vault
- Return form prepared by Tax Expert
- Filed by Our Experts
- Salary Details of Employees/Labours
- Details of Employer
- Details of responsible person
- Challan details
EPF Compliance explained in this short video!
What is the Employee Provident Fund (EPF)?
What is the Employee Provident Fund (EPF)?
Employee Provident Fund (EPF) is a benefit for the employee during retirement. It is a social security fund created for the purpose of providing financial security and stability during retirement.
Applicability:
- Every specified factory or establishment in which 20 or more persons are employed. With the amendment in the rule of EPF, the limit of the minimum employee is 10 employee.
- Any factory or Establishment can also willingly cover under the Act, even if the number of employees is less than 20.
Eligibility:
Any person who is employed for work of an establishment or employed by the contractor in or in connection with the work of an establishment and drawing salary up to Rs.15,000/- p.m. The salary is calculated as Basic Salary plus Daily Allowance.
Rates of Contribution:
- Employer – 12%
- Employee – 12%
- – 1.16% to Central Govt.
Insurance Scheme:
All members contributing to Provident Fund are automatically insured for their life during the Service. Employer’s Contribution to the Insurance Scheme is 0.5%. The maximum amount payable to the nominee in case of death of an employee is Rs.100000/-
Pension Fund:
All employees covered under the Provident Fund become members of the Pension Scheme. 8.33% of Basic Salary up to Rs.15,000/- is contributed to the Pension Scheme from employers share of contribution. A minimum period of ten years of contributory service is required to be eligible to receive monthly Pension. The full pension is payable on completion of 20 years of contributory service.
Compliance Checklist under the EPF Act
Compliance Checklist under the EPF Act
| S.No. | Provisions | Compliance |
| 1 | Employer and Employee’s PF dues | 15th of the following month |
| 2 | Payment of Pension Fund | 15th of the following month |
| 3 | Payment of Insurance Fund | 15th of the following month |
| 4 | Detail of employees | Detail of employees enrolled as members PF fund, within 1 month of coverage in the prescribed form |
5 | Nomination Form | Immediately on Joining the fund in the prescribed form |
6 | Addition of members | Detail of newly enrolled members within 15 Days of the following month in the prescribed form |
7 | Deletion of member | Detail of members left service during the monthbefore21st of the following month in the prescribed form |
8 | Details of contribution | Detail of employees and employer’s contribution by 25th of the following month in the prescribed form |
9 | Detail of wages and contribution | For each member details shall be given By 30th April every year |
10 | Yearly Consolidated statement of contribution | To be forwarded yearly along with Form 3A |
11 | Return of ownership of the establishment | Within 15 days on coverage and whenever there is a change in ownership |
| 12 | Transfer of PF | Form 13 needs to file |
In addition to above Compliance related Insurance and pension also need to duly comply with.
Withdrawal rules under EPF Act
The funds from an EPF account can be withdrawn completely in full settlements on attaining 58 years of age or at the time of retirement the employee can claim for a complete settlement or if an employee remains unemployed for a period of 2 months or more or in the case of death while in service before attaining the age of retirement, in which case the nominees or legal heirs are entitled to withdraw the accumulated fund.
The partial withdrawal of funds from the EPF is available for educational opportunity, medical treatment, repayment of home loan, marriage, purchase of land/house/flat, in case the establishment/factory is closed, natural calamity, an year before retirement and unemployment for a period of more than one month.
Penalties on Non-Compliance to EPF Act
- Penalty of 12% per year interest for each day of delay in payment of contribution
- Penalty on late payment as mentioned:
- Delay up to 2 months: 5% interest p.a.
- Delay of 2-4 months: 10% interest p.a.
- Delay of 4-6 months: 15% interest p.a.
- Delay of more than 6 months: 25% interest p.a. not exceeding 100% at a time
Benefits of EPF
The employees covered under the various schemes of the Act are entitled for the following benefits
Employees can take advances or make withdrawals*.
PF amount of a deceased member is payable to the nominees or legal heirs.
The employer not only contributes towards the PF but also makes the necessary contributions towards the employee’s pension which can be used by the employee post-retirement
Under the EDLI Scheme employees are properly insured in order to avail the lump sum benefit at the time of death while in service.
EEE (Exempt, Exempt, Exempt) tax benefit under the Income Tax Act enables tax-free returns for the employees.
Employees receive special benefits in the form of added income to their savings in the form of interest.
PF account can be transferrable if any member changes employment from one establishment to another where such Provident Fund scheme is applicable.
