What is employer contribution in salary?
James Williams
Published May 17, 2026
Yes. According to the current EPF rules, an employer also has to contribute to his/her employee’s account. An employer has to contribute 12 percent of salary of an employee. (Salary here is basic plus dearness allowance and retaining allowance.)
Can employer contribute more than 12 for PF?
The EPFO allows an EPF or PF account holder to opt for the VPF and invest beyond 12 per cent of its basic salary in one’s provident fund account. However, for this VPF contribution made by the employee, the employer will not contribute any additional amount.
What is the current employer PF contribution rate?
12%
Total contribution made by the employer is distributed as 8.33% towards Employees’ Pension Scheme and 3.67% towards Employees’ Provident Fund….EPF Contribution.
| Contribution by | Monthly Percentage Contributed |
|---|---|
| Employer | 12% |
| Employee | 12% or 10% |
| Total | 24% |
Why PF is deducted twice from salary?
EPF rule says 12% of your basic + allowance will be deducted from your gross salary and employer will match the same amount (which is included in CTC). So basically 24% of your (basic+allowance) deducted and deposited to your EPF account.
What is the EPF interest rate for 2020 21?
8.5 percent
The Employees Provident Fund Organization (EPFO) is expected to credit 8.5 percent interest for the financial year 2020-21 till the end of July, as per a Zee Business report. The interest will be credited directly into the beneficiaries account by July end.
Is employer PF contribution deducted from salary?
As per the Employees Provident Fund Act, the employer’s share cannot be deducted from the member. Also, it cannot be recovered from the salary of employees. If the employee PF was deducted and not paid, it is incorrect.
What is basic salary for EPF?
Out of the 12% contribution, 8.33% goes towards the Employee Pension Scheme Account, and the remaining 3.67% goes to the employee EPF account. It is compulsory for all employees who draw a basic salary of less than Rs 15,000 per month to become members of the EPF.
What is EPF interest rate 2020?
The Employees’ Provident Fund Organisation (EPFO) announced to retain 8.5% rate of interest on provident fund deposits for the current financial year 2020-21.
