Higher pension Scheme India is a employee pension scheme offered by the Employee Provident Fund Organization (EPFO) in India. It allows employees to contribute a higher amount of their salary towards their pension, which will result in a higher monthly pension after retirement. The higher pension contribution is 8.33% of your actual basic pay, as opposed to the 8.33% of your pensionable salary capped at Rs 15,000 per month.
PF Contribution Employee & Employer
The Employee PF Contribution is done by both Employee & Employer. 12% of PF has been deducted with Employee contribution and Employer has contributed 12% of the PF. Total 24% of the PF contribution is deposit to the PF Contribution.
Contribution
Employee Contribution
Employer Contribution
Basic + Dear Allowance (DA)
12%
12%
PF & Pension Contribution
The Total 24% of the total PF & Pension has been split in to two PF & Pension Contribution. 12% of Employee PF Contribution is contributed into PF A/C No. 1 and 3.67% of the Employer contribution has been go into PF A/C No. 1. The 8.33 of the Pension Contribution has been go in to the EPF Pension A/C No. 10. As per the current calculation Rs.1250/- (Max cap will go to the EPS Pension A/C No. 10 ie Rs.15000/- (Basic + DA)
Contribution
PF A/C No.1
EPS (Pension A/C No.10)
Employee Contribution
12%
12%
Employer Contribution
3.67% or Difference Amount
8.33% or Rs.1250/-
Current PF Calculation Example
Below is the example of the current PF Calculation
Basic + DA Salary
PF (A/C No 1)
EPS (A/C No 10)
Contribution
30000
3600
0
Employee Contribution
30000
2350
1250
Employer Contribution
Total
5950
1250
Employer Contribution
PF Calculation when opting Higher Pension Scheme India
Below is the example of opting Higher Pension Scheme India Calculation
Basic + DA Salary
PF (A/C No 1)
EPS (A/C No 10)
Contribution
30000
3600
0
Employee Contribution
30000
1100
2500
Employer Contribution
Total
5700
2500
Employer Contribution
Benefits of Opting Higher Pension Scheme India
The amount of your monthly pension will depend on your average basic salary for the last 5 years of service, your age at retirement, and the number of years you have contributed to the higher pension scheme.
The Pension Calculation formula is derived as
Pension Calculation = Average 60 Months PF Basic /70 * Numbers of years of Service
Here is the example for current PF Pension Calculation and Opting for PF Higher Pension Calculation if the Average Basic Salary is Rs.30000/- and years of Service is 10 Years.
PF Pension Calculation
Average 60 Month Basic Salary
Pensionable Salary
Years
Pension Calculation
Current Calculation
30000
15000
10
2143
Opting of Higher Pension
30000
30000
10
4286
Total
5700
2500
Employer Contribution
5700
Pension Calculator
You can calculate your pension using the below PF Pension Calculator
How to Opt for Higher Pension Scheme India
For Opting Higher Pension Scheme you have to follow the below steps
Enter the PF UAN, Aadhaar Card and Service Details etc
Upload 26(6) Joint Declaration form and PF Contribution details.
Last date for applying higher pension is 26th June 2023.
There are a few benefits to opting for the higher pension scheme. First, it will give you a guaranteed income stream after retirement. Second, it will free up some of your EPF corpus, which you can then invest in other financial products to grow your wealth. Third, it will reduce the burden on you of undertaking exhaustive retirement planning.
However, there are also a few drawbacks to the higher pension scheme. First, it will reduce the size of your EPF corpus, which you can then withdraw as a lump sum after retirement. Second, you will have to pay a higher contribution towards your pension, which will reduce your take-home salary.
Ultimately, the decision of whether to opt for the higher pension scheme is a personal one. You should weigh the benefits and drawbacks carefully and decide what is best for your financial situation.
Here are some things to consider when deciding whether to opt for the higher pension scheme:
Your current financial situation
Your retirement goals
Your risk tolerance
Your investment knowledge
Your age
Your expected retirement ages
If you are unsure about whether the higher pension scheme is right for you, you should speak to a HR or PF advisor.
EDLI stands for Employee Deposit Linked Insurance Scheme in Provident Fund. Employees Deposit Linked Insurance Scheme was introduced in the year 1976. EDLI Scheme is a Life Insurance scheme for the employees.
The EDLI Benefits provided under the Scheme in the nature of life insurance as follows.
The scheme is open to all EPFO members.
On the Death of employment while in service a lumpsum of Insurance amount is payable to his nominees or family members.
The Insurance amount is equal to the average balance in the PF Account of the deceased employee during a period of 12 months immediately preceding his death. In case the average balance.
Minimum Insurance cover is Rs. 2.5 Lakhs and the Maximum Insurance cover is over to 7 Lakhs.
What is the Monetary Benefits of EDLI Scheme?
With effect from 28.04.2021, the EPFO has increased the maximum benefit to Rs.7 lakh for the registered nominees of the deceased member.
The Ministry had increased the minimum amount of benefit to Rs.2.5 lakh on Feb 2018 for two years. However, the EPFO has further decided to continue with the same minimum benefit of Rs.2.5 lakh with retrospective effect from 15th Feb 2020.
Also, with effect from 28.04.2021, the EPFO has extended the benefit to the nominees of the deceased member who have changed their establishment for employment within a period of 12 months preceding the month of their death.
The EDLI Claim to be applied by the nominee of the deceased online or offline in case of E Nomination is not done by the deceased employee. Following are the documents to be submitted by the nominees
Death Certificate of the deceased
Legal Heir Certificate of the Deceased
Aadhaar card copy of the deceased
Aadhaar card copy of the nominees
PAN Card copy of the nominees
Birth Certificate in case of the nominee is children
Bank Account number of the nominees
On receipt of the claim the EPFO will release the share amount mentioned in the deceased legal Heir / Succession Certificate issued by the Government or Court.
Maharashtra Minimum Wages for shops and establishments in Maharashtra is effective from 01.01.2023 and employers are advised to pay arrears based on the notification attached. The total per month column mentioned below includes Basic and VDA only, but the HRA component may be used for arriving at overall wages
Labour welfare fund contribution slab 2022 tamil nadu
Labour welfare fund contribution slab 2022 tamil nadu was revised with effective from 2nd December. The Government of Tamil Nadu, vide Notification G.O.MS.No. 161, revised the rate of contribution, under the Tamil Nadu Labour Welfare Fund Act, 1972, to twenty rupees for employees and forty rupees for employers, effective from 2nd December 2022.
Employee Contribution
Employer Contribution
Total Contribution
Compliance Date
Rs.20/-
Rs.40/-
Rs.60/-
31st January Every Year
The Labour Welfare fund Contribution to be deducted from employee salary in the month of December Every Year.
Please refer to the notification for more details for Labour welfare fund contribution slab 2022 tamil nadu
Labour welfare fund is a statutory contribution managed by State Government. The state labour welfare board determines the amount and frequency of the contribution. The contribution and periodicity of remittance differs with every state. In some states the periodicity is annual (Andhra Pradesh, Haryana, Karnataka, Tamil Nadu etc) and in some states it is to be contributed during the month of June & December (Gujarat, Madhya Pradesh, Maharashtra etc).
Labour welfare is an aid in the form of money or necessities for those in need. It provides facilities to labourers in order to improve their working conditions, provide social security, and raise their standard of living.
To justify the above statement, various state legislatures have enacted an Act exclusively focusing on welfare of the workers, known as the Labour Welfare Fund Act. The Labour Welfare Fund Act incorporates various services, benefits and facilities offered to the employee by the employer. Such facilities are offered by the means of contribution from the employer and the employee. However, the rate of contribution may differ from one state to another.