How EPF contributions work
Under the Employees' Provident Funds & Miscellaneous Provisions Act, 1952, both employee and employer contribute 12% of PF wages (basic + dearness allowance) every month. The employee's 12% goes entirely to the EPF account. The employer's 12% is split: 8.33% goes to the Employees' Pension Scheme (EPS) on wages capped at ₹15,000 (maximum ₹1,250), and the balance 3.67% — plus the full 12% on any wages above the ceiling if the employer contributes on full basic — goes to EPF. The employer additionally pays 0.5% towards EDLI insurance and 0.5% administrative charges.
Formula
- Employee EPF = 12% × PF wages
- Employer EPS = 8.33% × min(PF wages, ₹15,000)
- Employer EPF = 12% × PF wages − EPS
- Interest (8.25% for FY 2024-25) accrues monthly on the running balance and is credited yearly.
Worked example
Basic + DA ₹25,000, employer contributes on full basic. Employee EPF = ₹3,000. EPS = 8.33% of ₹15,000 = ₹1,250. Employer EPF = 3,000 − 1,250 = ₹1,750. Monthly EPF credit = 3,000 + 1,750 = ₹4,750; EDLI ₹75 and admin ₹125 are additional employer costs. If the employee is 30, retires at 58, gets 5% yearly increments and interest stays at 8.25%, the projected EPF corpus is over ₹1 crore — the year-wise table shows how contributions and compounding build it.
Why use this calculator
Payroll teams can verify ECR challan figures (Accounts 1, 2, 10, 21), employees can see the real value of a higher PF-wage base or voluntary PF, and anyone can project their retirement corpus with salary growth. Remember that EPS builds a separate pension (not shown in the corpus) payable monthly after age 58, and that interest on employee contributions above ₹2.5 lakh a year is taxable.
Checking your passbook
Log in to the EPFO member portal with your UAN and compare the monthly employee, employer and pension columns with this split. Mismatches usually mean the employer is contributing on capped wages or has not filed the ECR for that month.
Frequently Asked Questions
Is PF contribution mandatory above ₹15,000 basic?
Coverage is mandatory for employees with PF wages up to ₹15,000 at joining. Employees above that can be excluded if they were never PF members, but once a member always a member. Employers may limit their contribution to 12% of ₹15,000.
What is the current EPF interest rate?
8.25% per annum for FY 2024-25, declared by the EPFO Central Board in February 2025. The rate is reviewed every year; the calculator lets you change it.
Who is eligible for EPS?
Employees who joined EPF before 1 September 2014, or those joining later with PF wages up to ₹15,000. New members above the ceiling after that date get the full employer 12% in EPF with no EPS.
What is VPF?
Voluntary Provident Fund lets you contribute more than 12% of basic (up to 100%) into the same EPF account at the same interest; the employer does not match it. It is a safe, tax-efficient debt investment under 80C.
Disclaimer: This tool is for general information and estimation only. Tax rates and rules change — verify with official sources or a professional before acting. Read full disclaimer.