FAQs

• What is the contribution rate for the Employee Provident Fund (EPF)?

  The contribution rate for the Employee Provident Fund (EPF) is 12% of the employee's basic salary and dearness allowance. Both the employer and the employee contribute 12% of the employee's salary to the EPF account, with the total contribution amounting to 24% of the employee's salary. The employer's contribution is divided into two parts: 3.67% towards the EPF and 8.33% towards the Employee Pension Scheme (EPS).

• What is the interest rate offered on the Employee Provident Fund (EPF)?

  The interest rate offered on the Employee Provident Fund (EPF) is set by the government and is subject to change periodically. The EPF interest rate for the financial year 2021-22 is 8.5% per annum. The interest earned on the EPF account is compounded annually and credited to the employee's account at the end of the financial year.

• What are the tax benefits of investing in the Employee Provident Fund (EPF)?

  Investing in the Employee Provident Fund (EPF) offers several tax benefits to employees. Contributions made to the EPF are eligible for a deduction under Section 80C of the Income Tax Act, up to a maximum of Rs. 1.5 lakh per year. Additionally, the interest earned on the EPF account is tax-free, and the maturity amount is exempt from tax if the employee has completed five years of continuous service.