PF Calculator

What Is EPF (Employee Provident Fund)?

The Employee Provident Fund (EPF) is a retirement savings scheme managed by the Employees' Provident Fund Organisation (EPFO) in India. Both the employee and employer contribute 12% of the employee's basic salary + dearness allowance every month. The employee's contribution goes entirely to the EPF account. The employer's 12% is split: 8.33% goes to the Employee Pension Scheme (EPS) and 3.67% goes to EPF. As of 2024, EPFO manages over Rs 18 lakh crore in assets for 67 million active subscribers, making it one of the largest social security organizations in the world.

How Is PF Calculated? Employer and Employee Breakdown

PF contribution is calculated on basic salary + dearness allowance. The statutory ceiling for PF is Rs 15,000/month (basic + DA), but many companies contribute PF on actual basic salary.

PF Interest Rate History (Last 5 Years)

EPFO declares the interest rate annually. The rate has been declining over the past decade but stabilized around 8.15% to 8.25% in recent years, which is still higher than most fixed deposits and debt mutual funds on a tax-adjusted basis.

• Interest is calculated monthly but credited annually at the end of the financial year.
• Interest on EPF contributions above Rs 2.5 lakh per year is taxable since FY 2021-22.
• PF interest is tax-free on contributions up to Rs 2.5 lakh/year (Rs 5 lakh if employer doesn't contribute to any other retirement scheme).

PF Withdrawal Rules: When Can You Withdraw?

PF withdrawal rules vary based on the reason and your employment status.

• Full withdrawal on retirement: You can withdraw the entire PF balance at age 58. If you've contributed for 10+ years, you also get a monthly EPS pension.
• Withdrawal after 2 months of unemployment: If you leave a job and remain unemployed for 2 months, you can withdraw the full PF balance. You'll need to submit a signed declaration that you haven't found new employment.
• Partial withdrawal (advance): Allowed for specific purposes while still employed. Marriage (50% after 7 years), medical emergency (up to 6 months' salary), home purchase (up to 36 months' salary after 5 years), education (50% after 7 years).
• Transfer between employers: The easiest option when changing jobs. Submit Form 13 through your new employer's EPFO portal. Takes 10-20 days. Your PF balance, including employer contributions, transfers seamlessly.
• 75% partial withdrawal after 1 month: A 2020 rule allows you to withdraw up to 75% of your PF balance if you've been unemployed for 1 month. The remaining 25% can be withdrawn after 2 months.

What Is VPF (Voluntary Provident Fund)?

VPF or Voluntary Provident Fund lets you contribute more than the mandatory 12% of your basic salary to your PF account. You can contribute up to 100% of your basic salary. The VPF earns the same interest rate as EPF (8.25% for FY 2024-25) and gets the same tax treatment. It's one of the safest high-return investment options for salaried employees, especially for those in the 30% tax bracket. However, since FY 2021-22, interest on total EPF + VPF contributions exceeding Rs 2.5 lakh per year is taxable. So if your regular PF contribution is Rs 2 lakh, only Rs 50,000 of additional VPF contribution earns tax-free interest.