EPFO Wage Limit: The Supreme Court issued this ruling on a petition filed by Naveen Prakash Nautiyal. The petition states that the current EPF wage limit has not been increased since 2014. During this period, wages have increased significantly, particularly in urban areas.
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EPF Wage Limit: The Supreme Court has issued a significant ruling regarding the Employees’ Provident Fund (EPF). It has directed the Employees’ Provident Fund Organization (EPFO) to revise the monthly wage limit of ₹15,000 for enrollment in the EPF scheme. This will impact the retirement savings of private sector employees. The Supreme Court has directed the EPFO to take a decision on this matter within four months. This means that the EPFO will have to increase this limit.
EPF Wage Limit Has Not Been Raised Since 2024
According to a report by news agency PTI, the Supreme Court issued this ruling on a petition filed by Naveen Prakash Nautiyal in this matter. The petition states that the current EPF wage limit has not been increased since 2014. During this period, wages have increased significantly, especially in urban areas.
Increasing the wage limit will increase the contribution
The EPF wage ceiling determines how much of an employee’s salary will be contributed to the provident fund. Currently, 12% of the employer’s basic salary (plus DA) is deposited into the employee’s EPF account every month. The employer contributes the same amount to the employee’s EPF account every month. There is a limit of Rs 15,000. The contribution increases only if the employee voluntarily selects the higher contribution option.
Employees’ retirement savings will also increase
Of the employer’s 12% contribution, 8.33% goes to the Employees’ Pension Scheme (EPS). The remaining 3.67% goes to the employee’s EPF account. The increase in the wage ceiling will automatically increase employees’ contributions, thereby increasing their retirement savings and pension benefits. The wage limit was last increased in 2014. Since then, salaries have increased significantly, but EPF contributions for many employees have remained stagnant.
Supreme Court decision benefits employees
The increase in the EPF wage ceiling will increase the retirement funds of those working in the private sector. This will particularly impact those in the middle income bracket. Pratik Vaidya, MD of Karma Management Global Consulting Solutions, said, “The increase in the EPF wage limit will increase monthly EPF contributions. This will also increase the retirement corpus in the long run.” This is good news for employees in terms of retirement funds.
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