EPFO considering removing 12% ceiling on employees' contribution to EPS

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In a bid to enable subscribers with basic pay up to Rs 15,000 to earn a higher pension and build a bigger corpus, the Employees’ Provident Fund Organisation (EPFO) is considering to do away with the 12 per cent ceiling that is currently applicable on members’ contribution to the Employee Pension Scheme (EPS), while keeping the employer’s share of 12 per cent unchanged, official sources familiar with the development said. 

 

Currently, employers and employees are mandated to contribute 12 per cent each of an employee’s basic pay into the Employee Provident Fund (EPF). Of the employer’s contribution, 8.33 per cent is diverted into the EPS (applicable only for people with basic pay of Rs 15,000). A contribution of 1.16 per cent of the monthly wages (limited to the amount payable on pay of Rs 15,000 only) is also paid by the central government. 

 

Additionally, the EPFO is also working to revamp its IT infrastructure for more seamless and efficient services to subscribers and easier withdrawals.