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EPF vs VPF Difference: What Is VPF and How Is It Different from EPF?

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EPF vs. VPF Difference: If you have a job, your EPF gets deducted, but some folks choose to add VPF deductions to boost their savings. VPF stands for Voluntary Provident Fund. Are you familiar with what VPF is and how it sets itself apart from EPF? If not, let’s dive into everything you need to know about VPF.

What is VPF?

When it comes to retirement, one of the biggest worries is figuring out how to enjoy your golden years. VPF can really help with that. VPF, or Voluntary Provident Fund, is quite similar to EPF. While EPF takes 12% of your salary, VPF lets you decide how much you want to contribute. In simple terms, it’s just another way to save.

How much fund can you deposit?

When saving comes up, the question often is how much can you actually put into VPF. According to the rules, you can contribute up to 100% of your basic salary into VPF. If you do this, you’ll have a nice chunk of change waiting for you after retirement. Just like EPF, VPF also offers good interest rates. It’s worth noting that VPF gives you an annual interest rate of 8.25%. Plus, it’s risk-free; there’s no chance of losing your money.

There is also benefit in tax

VPF is a fantastic way to save on taxes too. Your deposits are tax-exempt under Section 80C, allowing for a deduction of up to Rs 1.5 lakh. If your total EPF and VPF deposits are under Rs 2.5 lakh, the interest you earn is tax-free.

How to invest in VPF?

Getting started with VPF, or Voluntary Provident Fund, is super simple. Just let your company’s HR or Payroll department know that you want to contribute, and fill out a form to decide how much extra you want to add to your EPF from your salary. Many companies even offer this option through an online portal, and once you’re set up, a fixed amount will be deducted from your salary each month for VPF. If you switch jobs, your EPF and VPF accounts will transfer to your new employer, keeping your money safe and your investment ongoing. Plus, you can check your balance anytime using your EPF passbook, the UMANG app, or DigiLocker.

About the Author

Sweta Mitra

Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food,...

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SwetaMitra@timesbull.com Author at TimesBull TimesBull
Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food, and books. For feedback - timesbull@gmail.com
Sweta Mitra - Author at TimesBull
About the Author

Sweta Mitra

Sweta Mitra - Author at TimesBull

Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food,...

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