Good news for EPFO members: The central government may soon make changes in the EPS contribution rules with the aim of giving people more benefits during retirement than investing in EPFO. According to a senior Labor Ministry official, EPFO account holders may be allowed to contribute more for pension. The central government is considering removing the limit on employees’ contribution in PF.
EPFO holders currently contribute 12 percent of their basic salary to EPF. Whereas there is a provision for the employer to deposit 8.33 percent contribution in the employee’s pension account (EPS) and the remaining 3.67 percent contribution in the Provident Fund (EPF). This decision of the Central Government will benefit more than 7 crore EPFO holders of the country.
Will get big fund for retirement
The central government wants to encourage people to save more for retirement by removing the limit on PF contributions. Due to which a large fund will be available to the owners for pension. This step can be taken to ensure social and financial security to people after retirement.
Demand to increase salary limit by 15 thousand
TN Karumalaiyan, general secretary of the Center for Indian Trade Union, said that the government will first set the salary limit at Rs 1000. Consideration should be given to increasing it from Rs 15 thousand. This will increase the share of contribution in both provident fund and pension scheme. Currently the EPS profit is only Rs. Only employees with salary up to Rs 15 thousand get it.
What will be the benefit?
EPF includes contributions from both the employee and the employer, whereas in EPS only the employer contributes. In this, monthly Rs. You can invest up to Rs 1250. If this limit on investment in EPS is removed and the contribution is increased, the amount of regular pension received under this scheme after 58 years may increase. This will increase the regular income of people after retirement. Notably, EPF provides permanent benefits. In which the lump sum amount is returned after 58 years.
