Employees’ Provident Fund

All About Employees Provident Fund (EPF)

Learn all about Employees Provident Fund - its contributions, benefits, withdrawals, and tax advantages to secure your retirement savings in India.

Written by : Knowledge Centre Team

Last published : 2026-02-26

7 minutes read

Initiated by Employee Provident Fund Organization (EPFO), Employees’ Provident Fund (EPF) is a saving scheme that offer retirement benefits to its account holders. You can use it just like any other retirement plan. Both the employee and employer make contributions to the scheme every month in equal proportions. The employee contributes 12%, whereas the employer contributes around 8.43% to the EPF scheme. Basically, EPF is a welfare scheme for the benefit of employees. The interest earned on the investment made in EPF is credited in the PF account of the employees.

 

Interest Applicable on Employees’ Provident Fund (EPF)

The interest rate of the EPF scheme is reviewed every year. The interest rate of EPF is 8.50% for the financial year of 2020-2021. The EPFO publishes the interest rate for a particular financial year when the year ends. The interest rate is calculated for the month-wise closing balance and after that for the whole year.

  • Every year new interest rates are declared. They are valid until the next financial year. Below are some of the essential facts that you know regarding EPF interest rates:
  • The prevailing interest rate is valid and applicable only on EPF deposits created between April 2020 and March 2021.
  • One month's transferred interest is added up with the next month's balance, and then the interest is calculated on the whole amount, again.
  • If no contribution is made to an EPF account for thirty-six months or more, the account gets converted into a dormant or non-operative account.
  • However, interest is still provided to the non-operative accounts of employees who have not yet attained retirement age.
  • If some amount is deposited in the accounts of retired employees, no interest is offered on such an amount.
  • The interest credited to the non-operative accounts is liable for tax according to the member's slab rate.
  • The employee receives no interest in the employer's contribution towards the Employees’ Provident Fund; however, pension is furnished from this amount to the employee after 58 years.

 

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What is the Contribution Per Cent of the Employer and Employee in EPF?

An employee’s contribution goes directly into the EPF, while the employer’s contribution goes into the EPF, the EPS and the EDLIS. In an EPF account, both the employee and the employer make equal contributions.

Contributed byPercentage contributed - Monthly
Employer12%
Employee10% / 12%
Total24%

12% of the employer's contribution towards EPF contains 3.67% EPF plus 8.33% EPS. The EPF share of 10% is enough for organizations who have 20 or less than 20 employees. An aggregate of 8.33% contribution is taken from the employer for Employees Pension Scheme; however, only 3.67% of this contribution is made towards the Employees’ Provident Fund. The contribution made by the employee is dedicated solely towards the Employees’ Provident Fund.

Always remember that you must save enough for your retirement and you cannot rely on only an EPF account for that. Explore your options and invest wisely for a secured future.

Check if your retirement corpus will be enough.

 

How can an Employee Register for an Employees’ Provident Fund?

To register for EPF, follow these 5 quick steps mentioned below-

1. Visit the official website of the Employee Provident Fund Organisation (EPFO)

2. Go to the 'Registration' page; after that, it will take you to the 'Instruction Manual' page. On this page, you will find details for Employee Registration. For the new online submission, you will have to register your digital signature certificate

3. After that, accept the 'I have read the instruction manual' box to fill up the other details for registration further

4. After filling up all the details correctly, an email link will be sent to your mail, which you should verify along with a PIN sent to your mobile. Some additional documents are also required to be uploaded for registration purposes

5. You can skip all this and log in to your account if you've already registered earlier using your Universal Account Number (UAN)

In case you're looking for some other savings cum retirement plan to help you plan a stress-free retirement, Canara HSBC Life Insurance has the perfect option for you! One such retirement plan is Pension 4Life Plan. It offers you retirement benefits along with the option of a savings plan. This plan will safeguard your financial future by helping you build a significant retirement corpus. The plan ensures guaranteed regular income according to your needs after you retire. Some of its benefits are-

  • Delivery of a guaranteed steady income
  • Limited premium payments
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You can opt for a secured retirement plan in the form of an Employees’ Provident Fund or opt for the Pension4Life plan by Canara HSBC Life Insurance. In both ways, you stay ahead in the future and secure yourself from any unforeseen situations. Your future needs better planning, so make sure you are planning for your retirement beforehand.

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