The Employees’ Provident Fund Organisation (EPFO) has increased the mandatory wage ceiling for provident fund contributions from Rs 15,000 per month to Rs 25,000. With the revised ceiling, employees will contribute Rs 3,000 per month towards their Provident Fund (PF) savings, calculated at 12% of the Rs 25,000 wage ceiling, according to a set of FAQs released by the government. With the revised ceiling, employees will contribute Rs 3,000 per month towards their Provident Fund (PF) savings, calculated at 12% of the Rs 25,000 wage ceiling. This is higher than the earlier mandatory employee contribution of Rs 1,800 a month based on the Rs 15,000 ceiling. The employer’s contribution will also increase under the revised limit. Employers will contribute Rs 917 per month at the rate of 3.67%, compared with Rs 550 earlier. Further, it said that in addition, Rs 2,083, an 8.3% contribution from employers' share, will now go towards the pension kitty from earlier Rs 1,250. In the case of an employee with a monthly wage of Rs 20,000, the mandatory PF contribution will be Rs 3,134. The employee share Rs 2,400 and the employer share Rs 734, with an additional Rs 1,666 going towards EPS from employer's share. Centre had increased EPFO wage ceiling to bring one crore additional workers into the social security net as minimum wages in at least seven states and UTs have crossed the Rs 15,000 threshold. These included Delhi, Maharashtra, Karnataka, Haryana, Gujarat, Rajasthan and Uttarakhand - have crossed the Rs 15,000 threshold. But if an employee earns, say, Rs 35,000 a month, the mandatory PF contribution will be Rs 6,000 (Rs 3,000 from employee and employers each), with no amount going towards pension as EPS is available only to those whose wages do not exceed the EPFO wage ceiling. Vikas Kumar is Deputy Editor (Business) at Times Now driving coverage across policy, economy and markets. He possesses nearly a decade of experience i... View More