Employees' Provident Fund contributions look simple until you notice the employer's 12% is split, with part diverted to the pension scheme rather than your PF balance.
Employee 12 % of (Basic+DA), Employer 12 % (8.33 % to EPS up to ₹15k cap, rest to EPF).
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Employee contributes 12% of Basic + DA. All of it goes to the EPF account.
Employer also contributes 12%, but 8.33% is diverted to the Employees' Pension Scheme, capped at the wage ceiling.
The balance of the employer's contribution goes to EPF.
Where wages exceed the statutory ceiling, many employers restrict the EPS portion to the ceiling.
On Basic + DA of ₹15,000, the employee contributes ₹1,800 and the employer ₹1,800 — of which ₹1,250 goes to EPS and ₹550 to EPF.
Because 8.33% of it is diverted to the pension scheme (EPS). Only the balance lands in your EPF account, which is why the two sides rarely match.
Yes, through Voluntary Provident Fund. The employer is not obliged to match the extra.
It is tax-free after five years of continuous service. Withdraw earlier and it becomes taxable, with TDS in some cases.
Garuda HR looks after payroll, attendance, leave and statutory compliance for Indian teams — the same arithmetic, run for you every month, with a full audit trail. We would be glad to show you around.