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Know your EPF – Provident Fund Calculator, EPF Interest rate & more..

Published On 20 Aug 2011 By . Under: Fixed Deposit. Tags: ,   
 

What is Employee Provident Fund or EPF?

Employee Provident fund or EPF is a fund made up of contributions by the employee during the time he has worked, along with an equal contribution from the employer. It is a calculated as a percentage of employee’s salary (Basic Salary+DA+Retaining allowance), normally 12%, and returned upon retirement. In the absence of any social security cover for the elderly in India, employee provident fund not only provides monetary security and helps them meet daily living expenses, it also helps them live a life of dignity and respect after retirement.

Go directly to: How to calculate provident fund in india | Provident Fund Interest Rate | | Provident Fund Balance | Know Your EPF Balance |

Benefits of Provident Fund:

Apart from being a tool for our retirement savings, Provident Fund offers numerous more benefits:

  • PF entitles your to get Pension. As you must have seen in provident fund calculator above, 8.33% of employer contribution goes towards pension.
  • Employee Provident Fund in India provides you insurance too – 0.5% of your montly basic pay goes towards providing you insurance. The insurance cover is maximum of –

    1) 20 times the average monthly wage (maximum of Rs 6500) – which comes to Rs 1,30,000

    2) Full amount in your PF account up to Rs 50,000 and 40% of balance amount.

Provident Fund Interest Rate

The rate of interest for provident fund is fixed by the Central Government every year during March/April. While the provident fund interest rate in FY 2011-12 was 9.5%, this year it has been cut to 8.25%.

Is contribution towards Employee Provident Fund optional in India?

All industries and establishments employing more than 20 people are required to contribute towards Employee Provident Fund (EPF).

Know Your EPF Balance

Thanks to initiatives by PF Department, provident fund balance can now be checked online. To know your EPF balance go to EPF India’s website. The website shows PF account details for all offices in India. However as of today – 02 Apr 2012 – the account details have been updated till FY 2010-11 only. To learn how to use this online facility click here.

How to calculate provident fund in india?

What if you want to calculate provident fund amount on your own? In this section we will explain how you can calculate your provident fund balance:

12% of your basic salary is deducted as contribution towards your Employee Provident Fund. The employer also contributes 12% of your basic salary towards employee provident fund in India.

 Employee_Provident_Fund_India
Of the 12% contributed by employer – 8.33% of the contribution is towards EPF pension scheme, subject to a maximum of Rs 541. The remaining amount is contributed towards your Provident Fund. To make this easier we have prepared a Provident Fund Calculator. To use it click here.In case you find any issues in our provident fund calculator, mail us @ insureinvestwise@gmail.com

Source – EPF India;ET Wealth, Feb 7 2011 Edition
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