When I got my EPF amount in my bank account, I was not sure whether its the right amount I claim. I have got the amount in 2 portions so I thought one would be the employee's contribution and the other would be employer's. But that way the calculations didn't match. Its only after a day of many failed attempts that I could match my amount correctly with my calculation. And what a joy it was! I got to know that one portion was the total EPF portion (i.e. my EPF contribution + employer's EPF contribution) while the other was the EPS (Employee Pension Scheme) portion.
After becoming EPF enlightened, I thought of sharing my wisdom ;) with you. If you want to calculate your EPF amount, here are the steps -
Example EPF Calculation:
In my case, EE as well as ER contribution was 780/- Out of employer's 780/-, only Rs 239/- were going into EPF while the remaining Rs 541/- were going into EPS. Lets say I joined in Nov. The interest calulation on my contribution for the first 5 months of employment is given below :
|Date||Accumulated Employee Contribution||Monthly Interest @ 9.5%|
|1-Dec||780 (This amount is the contribution of November which got submitted in PF account on 1st Dec)||0 (No interest earned as on 1st Dec because there was no PF balance before this date)|
|1-Jan||1560 (This amount is the contribution of Nov. and Dec. both : 780+780=1560)||6 (Interest is calculated on the amount which was there in the account before this date: 780*9.5% /12)|
|1-Feb||2340 (1560+780=2340)||12 (1560*9.5% /12)|
|1-Mar||3120 (2340+780=3120)||19 (2340*9.5% /12)|
This means my total contribution for this whole financial year is 3120/- and the interest is 37/- . The interest will be added to the contribution at the end of the financial year. So next year 3120/- + 37/- will become my opening balance and the calculation will go on like this. Similarly employer's contribution is calculated below:
|Date||Accumulated Employer Contribution||Monthly Interest @ 9%|
|1-Dec||239 (This amount is the contribution of November which got submitted in PF account on 1st Dec)||0 (No interest earned as on 1st Dec because there was no PF balance before this date)|
|1-Jan||478 (This amount is the contribution of Nov. and Dec. both : 239+239=478)||2 (Interest is calculated on the amount which was there in the account before this date: 239*9.5% /12)|
|1-Feb||717 (478+239=717)||4 (478*9.5% /12)|
|1-Mar||956 (717+239=956)||6 (717*9.5% /12)|
This means employer's total contribution for this whole financial year is 956/- and the interest is 12/- . So next year 956/- + 12/- will become the opening balance and the calculation will go on like this.
Note: To know the EPF interest rates for a particular year, see this post : EPF Interest Rates
If you have filled the withdrawal option in Form 10C, you would get a EPS portion back. Here are some facts:
|Years of Service||Proportion of wages at exit|
Example EPS Calculation:
I had completed 1year 5 months in my previous company, so for the purpose of EPS calculation my 'years of service' will be counted 1 year. My monthly salary was > Rs 6500 per month but for purpose of EPS only Rs 541 p.m or Rs 6,500 annually is considered. So the EPS amount that I got back was 1.02*6500 = Rs 6630/-
With the above information on your fingertips, I hope you would be able to solve your EPF - EPS mystery. Wish you good luck!
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