EPFO: Your salary in hand may decrease! Which PF rule has changed

Bibhash Lodh, BS News Agency: Your pay slip may change from October. Recently, a big change has come in the Employees Provident Fund. The proposal to increase the maximum salary limit or wage ceiling from Rs 15,000 to Rs 25,000 has been approved. This rule has come into effect from September 17. And due to this, there may be changes in the pay slip. In-hand salary may decrease.

As a result of the change in the wage ceiling or salary limit, about 51 lakh new employees of the country will come under this social security. They will also get all the facilities under EPFO.

What will be the impact on the salary in hand?

 Employees whose basic salary is between 15,000 and 25,000 rupees may see some reduction in their take-home salary, but in the long run, the retirement fund will increase significantly under this new rule. This initiative has been taken to secure the future.

How much money will be deducted?

PF is deducted at the rate of 12 percent. Earlier, 1,800 rupees was deducted for PF contribution up to the salary limit of 15,000 rupees. Under the new rule, the deduction will be made up to the salary limit of 25,000 rupees. This amount can increase to a maximum of 3,000 rupee

Impact on salary?

Those who are coming under PF for the first time under this new rule, their in-hand salary or salary received in hand may decrease by a maximum of 1,200 rupees per month. However, there will be no significant change in the salary received in hand for those who were already contributing money to PF based on their entire basic salary.

How will the company's fund account change?

 As per the rules, 12 percent of an employee's salary is deposited in his/her PF fund. On the other hand, the 12 percent contribution made by the company is divided into two parts. One part goes to the Pension Scheme (EPS) and the rest goes to the Provident Fund (EPF).

Under the old rules, i.e., the maximum contribution of Rs. 15,000, where earlier Rs. 1800 was deposited, now it can be increased to Rs. 2082

What are the benefits of this decision?

Although the current monthly income is slightly less, it is said that this decision will be very beneficial for the employees in the long run.

Retirement Fund: Due to the additional money deposited every month, the PF balance will increase rapidly. The EPFO ​​will also get fixed interest on the deposited amount.

Social Security: Along with PF, employees will get more security under the Pension Scheme (EPS) and Life Insurance Benefit or 'EDLI'.