EPFO News: The government may increase the monthly salary limit for the Employees’ Provident Fund Organization (EPFO) Retirement Savings Scheme. At present this limit is Rs 15,000 per month.
According to a report, now this limit can be increased to Rs 21,000 a month. Last time this limit was increased in 2014. Then the monthly limit for EPFO was Rs 6500, which was increased to Rs 15,000. However, this limit is applicable only to those companies where the total number of employees is more than 20.
The government is hopeful that after increasing the salary limit for joining EPFO, the mandatory contribution from the side of the company and the employees will increase. This will enable employees to save more for their retirement. With this, more and more people will come under the ambit of EPFO.
According to a report in ET, after increasing the salary ceiling of EPFO, about 75 lakh employees will come under this purview. Presently 6.8 crore employees are registered under EPFO.
How does this sealing work?
At present, employees earning Rs 15,000 per month come under the purview of EPFO. The company and the employees together have to contribute 12% of the salary to the EPFO. Secondly, those employees of the organized sector whose salary is less than Rs 15,000 are also required to become members of EPF. In such a situation, if the employee wants, he can increase his contribution, but only a fixed amount is contributed by the company.
