EPFO Rule 2025: Regarding the EPF scheme, which is run to protect employees’ savings, a frequent question arises: can employees contribute more than 12%? The EPFO has clearly outlined the rules for this, which every employed person should know. Let’s understand two important questions related to additional contributions to EPF, its limit, and the contribution rate.
Can you deposit more than 12%?
Yes. According to EPFO rules, any employee can contribute more than their normal 12% EPF deduction as a voluntary contribution. This contribution is at the employee’s discretion, meaning they can choose whether to contribute more. The advantage of this is that your retirement savings grow faster, and EPF interest also applies to the increased contribution.
However, it’s important to note that the total amount of normal and additional contributions can only be deposited on a salary base of Rs 15,000 per month. The employer, i.e., the company, can limit its contribution to the statutory rate, i.e., 12%. If an employee’s salary exceeds Rs 15,000 and they wish to have EPF deducted on their entire actual salary, they can do so. However, this requires the permission of the Assistant Provident Fund Commissioner (APFC) and the Regional Provident Fund Commissioner (RPFC), as provided in paragraph 26(6) of the EPF Scheme.
What is the EPF contribution rate for a member?
According to EPFO rules, an employee contributes 12% of their basic salary, DA, and retaining allowance to the EPF. The employer also contributes 12%, but not all of it goes into the EPF. 8.33% goes into the pension fund (EPS) and 3.67% goes into the EPF. Thus, the balance of a working individual’s future, pension, and savings is protected under the EPF scheme.