Provident Fund (EPF, EPS & EDLI), 2026 guide for Mumbai employers
Everything Mumbai HR and payroll teams need to run monthly EPF: contribution split, wage ceiling, ECR upload, UAN management, withdrawals, and penalties. Updated for FY 2026-27.
Every establishment with 20 or more employees must register under the EPF & MP Act 1952. Employee contributes 12% of basic + DA, employer matches 12% (split as 8.33% to EPS up to ₹15k wage + 3.67% to EPF). Add 0.50% EDLI (insurance) and 0.50% admin charges on employer side. ECR + payment due by 15th of every month. Portal: epfindia.gov.in.
EPF, EPS and EDLI rates on ₹15,000 wage ceiling
The statutory split of the 12% employer contribution. Employer also pays EDLI and admin charges on top.
| Component | Employee | Employer | Goes to |
|---|---|---|---|
| Provident Fund (EPF) | 12% | 3.67% | EPF account |
| Pension Scheme (EPS) | - | 8.33% | EPS (capped at ₹15k wage) |
| EDLI (insurance) | - | 0.50% | Life cover up to ₹7L |
| EPF admin charges | - | 0.50% | EPFO admin (min ₹500/₹75) |
| Total employer cost | 12% | 13% | - |
If an employee's basic + DA exceeds ₹15,000/month, the EPS portion (8.33%) is calculated only on ₹15,000 (max ₹1,250). The balance flows to EPF. For employees earning above the ceiling, employer EPF + employee 12% can be on full wages by mutual agreement.
EPF forms a Mumbai HR team uses regularly
The forms required for joining, exiting, withdrawal, transfer and nomination under EPF.
Declaration on joining
New employee declares prior EPF membership. Used for UAN linkage.
New joiner list
Employer files monthly to add new EPF members to the establishment.
Exit / leaver list
Employer files monthly to mark employees who left.
PF final withdrawal
Member claims full EPF accumulation post resignation/retirement.
EPS pension withdrawal
Withdraw pension share if service less than 10 years.
Partial advance
Loan/advance for medical, marriage, education or house.
PF transfer
Transfer EPF balance from previous to current employer.
LIC linkage
Authorise EPF deduction towards LIC policy premium.
Nomination
Member nominates beneficiaries for EPF and EPS.
When can an employee withdraw EPF
Full and partial withdrawal rules under the EPF Scheme 1952.
Full withdrawal at 58
100% of EPF accumulation including interest, tax-free if service is 5+ years.
After 2 months unemployment
Full EPF withdrawal allowed. Tax-free if 5+ years continuous service.
Self/family illness
Up to 6 months basic + DA. No minimum service required.
Self or children's marriage
Up to 50% of employee contribution. 7+ years service required.
Children's higher education
Up to 50% of employee contribution. 7+ years service required.
House purchase / construction
Up to 36 months basic + DA or 90% of EPF balance. 5+ years service.
Cost of late EPF payment
Two charges apply on overdue PF contributions, both compounding monthly.
Interest on delay
12% per annum simple interest from due date till payment.
Damages on default
5% to 25% per annum based on delay: 5% (less than 2 months), 10% (2-4 months), 15% (4-6 months), 25% (more than 6 months).
Prosecution
Wilful default can attract imprisonment up to 3 years and fine. Repeat default carries higher penalties.
Provident Fund FAQs
When does an establishment have to register under EPF?
When the headcount first reaches 20 employees. Registration must be completed within 30 days of crossing the threshold. Establishments below 20 can register voluntarily. PF coverage continues even if headcount later drops below 20.
What is the EPF wage ceiling in 2026?
The statutory wage ceiling is ₹15,000 per month (basic + DA). EPS contribution is capped at this ceiling. EPF can be paid on actual wages above the ceiling by mutual agreement between employer and employee.
What is the EPF interest rate for FY 2024-25?
EPFO declared an interest rate of 8.25% per annum for FY 2024-25 (the most recent declared rate). Interest is credited annually to each member's account. The rate for FY 2025-26 is announced by EPFO Central Board of Trustees post the financial year.
What is UAN and how is it used?
UAN (Universal Account Number) is a 12-digit number assigned to every EPF member. It stays the same across job changes. Employees use UAN on the EPFO unified member portal to check balance, file claims, withdraw, transfer and update KYC.
When is EPF tax-free on withdrawal?
EPF accumulation including interest is fully tax-free if the employee has 5+ years of continuous service. Withdrawal before 5 years is taxable as salary income. From FY 2021-22, interest on employee EPF contributions above ₹2.5 lakh per year is taxable.
What is EDLI cover?
EDLI (Employees' Deposit Linked Insurance) provides a life-insurance cover to EPF members. Employer pays 0.50% of wages. On death of a member while in service, the nominee receives up to ₹7 lakh based on the formula in the EDLI Scheme.
Can a member contribute above 12%?
Yes. Members can voluntarily contribute above 12% under the Voluntary Provident Fund (VPF), up to 100% of basic + DA. The employer contribution does not increase. VPF earns the same interest rate as EPF, and is locked in like EPF.
What happens if an employer delays PF payment?
Two charges apply: 7Q interest at 12% p.a. from due date and 14B damages at 5-25% p.a. based on delay duration. Wilful default can also attract prosecution under Section 14A. factoHR payroll auto-files the ECR by the 15th and prevents these penalties.
Related Maharashtra guides
Auto-file PF ECR by the 15th, every month
factoHR auto-calculates EPF + EPS + EDLI + admin, validates KYC, generates the ECR file and uploads to EPFO before deadline. No penalty interest, no damages, no missed cycles.