EPFO Pension News: Only these people have got good news, more pension will come in their account; Check if you are on the list or not
New Delhi. Employees Provident Fund Organization has reinstated the old rule of contribution in Employees Pension Scheme i.e. EPS. That is, the old option of linking higher pension with the entire basic salary has been started again. This step of the government is expected to provide relief to some subscribers who had earlier opted for higher pension contribution. But not everyone will get the benefit. Let us know about this rule.
Before 2014, there was a rule regarding higher pension in EPFO. According to the rules, the employee could contribute to EPS according to his full basic salary and DA for higher pension.
Also read- EPFO Pension: If you have done a private job for 10 years, how much pension will you get, more or less than the government one; see calculation
But the salary limit was implemented in 2014. Since then this rule was removed. In 2014, EPFO imposed a maximum limit of basic salary of Rs 15,000. That means even if your basic salary is Rs 50 thousand, the contribution will be based on the limit of Rs 15 thousand only.
New members after 2014 did not get the option of higher pension.
Due to the limit of Rs 15 thousand, the minimum pension is Rs 1 thousand and the maximum is only Rs 7500. New employees joining EPFO after 2014, whose basic salary and DA is or was more than Rs 15,000, cannot choose the option of pension calculation based on their actual basic salary.
This capping significantly reduced the potential pension benefits for EPFO subscribers whose basic salary and DA were more than Rs 15,000.
Who will benefit from EPFO's restoration of higher pension?
The old rule of higher pension (EPFO Pension) which has now been reinstated is applicable only to those employees who have already exercised the higher pension option before 2014. Therefore, only a few employees will get the benefit. Restoration of higher pension option will not be applicable to all employees.
O. Dr. Rahul Singh, Associate Professor, P. Jindal Global University, said, "This facility is not universal. Employees who have not opted for higher contributions in the past or whose pension has been based on the salary cap of ₹ 15,000 will not benefit from this. While this move is positive for eligible members, continued initiatives towards more inclusive and clear pension reforms will be necessary in the future."
How much money is deposited in EPS?
According to EPFO rules, both the employer and the employee contribute a maximum of 12% of the basic salary and DA to the Provident Fund (PF). A part of the employer's contribution, 8.33% of basic pay and DA or Rs 1,250, whichever is higher, goes into the employee's EPS corpus which is used to pay monthly pension on his retirement.
Pension is calculated on the basis of pensionable salary, so most employees get very little monthly pension, even if their basic salary is much more than Rs 15,000.
Also read- IDFC First Bank was formed by the merger of these 2 companies, not a part of HDFC; Know the story before it got tainted with fraud
Chyawanprash is a part of every Indian's life, it reduces diseases and increases energy.