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PF Registration Procedure

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Employee Provident Fund

Employees Provident Fund is a scheme for the Indian Employees that is controlled by the Provident Funds and Miscellaneous Provisions Act,1952. The Employee Provident Fund is regulated under the umbrella of Employees Provident Fund Organization popularly known as EPFO.

All establishments that have employed 20 or more than 20 employees can apply for PF registration in India. In some cases subject to the circumstances and the exemption establishments employing less than 20 are still eligible for PF registration. The Employee gets an amount that includes the self and employer’s contribution with interest on retirement or resignation.

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What is the Employees Pension Scheme?

8.33% of the employer’s contribution is routed towards the Employees Pension Scheme that is calculated at Rs.15,000. The amount routed to the Employee Pension Scheme would be Rs.1250 in case the basic pay of the person is Rs.15,000. If the Basic Pay is less than Rs.15,000 then 8.33% of the amount will be routed and the balance will be retained in the EPF scheme. On superannuation, the employee would receive the full share with the employer’s share reserved for credit in the EPF account.

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The amount for the contribution of PF

The employer has to obtain the PF registration within 1 month of attaining the strength, in case of failure to abide by applicable penalties. A registered establishment continues under the purview of the Act even in case the No of employees falls below the required limit.

The employer has to contribute 12% of the (Basic Salary + Dearness Allowance + Retaining Allowance). An equal amount of contribution is to be made by the employee. If the establishment has engaged less than 20 employees the EPFO rules state that the contribution rate for both the employees and the employer is limited to 10 %. In most cases the employees who are employed in the private sector it is on the basic salary on which the whole contribution is calculated.

The breakup of the PF contribution

  • The 12 % contribution is divided into the following subdivision:
  • 3.67% of the contribution towards the Employees Provident Fund
  • 1.1% of the contribution towards the EPF administration Charges
  • 0.5% of the contribution towards the employee's deposit linked insurance
  • 0.01% contribution towards the EDLI administration charges
  • 8.33% towards the Employees Pension Scheme.

Documents Required for Registration

  • PAN of the Partner, Proprietor, or the Director
  • Address proof (can be any utility bill but should not be older than 2 months)
  • Aadhar card of Proprietor, Partner, or Director.
  • Canceled Cheque Or Bank Statement
  • Digital Signature of the Proprietor/ Partner or Director.
  • Hired/ Rented or Leased Agreement If there is any.

EPF charges

  • The contribution is rounded to the nearest rupee for each of the employees for the employee share, the contribution towards pension, and the EDLI contribution.
  • The employer share is the difference between the employee Share and the pension contribution.
  • The monthly payment amount towards the EPF administrative charges is rounded to the nearest rupee and a minimum of Rs.500 is payable.
  • In case the establishment has no member in the month the minimum administrative charges applicable will be Rs.75.
  • The monthly payment amount under the EDLI administrative charges is rounded to the nearest rupee and a minimum of Rs.200 is payable.
  • In case the establishment has no member in the month, the payable minimum administrative charge is Rs.25
  • Suppose the establishment is exempted from the PF scheme inspection charges of 0.18% ( Minimum Rs 5 ) is payable in place of the admin charges
  • In case the establishment is exempted under the EDLI scheme. The inspection charges of minimum Rs.1 @0.005% are payable in place of the administrative charges.

PF Registration FAQ's

PF registration has to be done with EPFO. The PF registration can be done online on the website.

For a salaried employee if the Basic and Dearness allowance is less than Rs.15,000 per month then it is mandatory to get the EPF registration by the employer.

Employees that draw less than Rs.15,000 per month need to get EPF registration mandatorily, and the employee drawing the Pay above the prescribed limit needs to get permission from the assistant PF commissioner to become a member

PF registration is mandatory for all establishments with 20 or more persons, if the establishment has fewer than20 employees still a PF registration would be required. The employee can become eligible for PF right from the commencement of the employment and onus of deduction and PF payment is with the employer.

It is very advisable to register a Partnership firm as a Registered Partnership Firm can file a suit in any court against any of the Partners or firm for the enforcement of any right arising from the contract referred by the Partnership Act. Also, only a Registered Partnership Firm can claim set-off or other proceedings in a dispute with a party.

It requires 20-25 days to obtain PF registration in India.

Not every Private Limited Company is required to obtain PF registration.

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