Provident Fund (PF)

What is Provident Fund (PF)?

PF (Provident Fund) Or EPF (Employee Provident Fund) is a plan subsidized by the government of India as a retirement plan. PF is managed by the EPFO (Employees Provident Fund Organization). It is one kind of scheme for salaried employees to invest during work life and get the benefits after retirement.

PF is compulsory for government employees; however, some private companies( More than 20 employees) are also providing PF. A government employee can contribute a part of savings towards a pension fund. In another way, upon retirement, the employee receives the entire amount with interest, as the interest rate is fixed by the EPFO every year. All the rules and regulations are defined by EPFO, and EPFO’s activities are managed by the Ministry of Labor and Employment.

PF contribution is made by both the employer and employee. They have to contribute about 12% of the salary every month in equal proportions. 12% is calculated on basic salary + DA( dearness allowance). There are 2 numbers- 1. Provident Fund Account Number and 2. Universal Account Number. UAN remains the same throughout employment history even if employees change jobs and the PF account number identifies the company details, employee particulars, and scheme particulars. By Universal Account Number employees can manage their accounts. 

 Also, See: TDS Return