EPFO Higher Pension Scheme: When it comes to personal financial planning, there are very few retirement options. However, the Employees Provident Fund Organization (EPFO) offers a retirement planning solution with the EPS scheme. Recently, the organization has decided to offer a higher Pension Scheme under EPS.
The most recent filing date was May 3, 2023 and has now been extended to June 26, 2023. Here’s everything you need to know about eligibility, benefits and how you can register.
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– EPFO (@socialepfo)
May 17, 2023
What is EPS?
EPS stands for Employees Pension Scheme and it is a retirement savings scheme introduced by the Government of India for employees working in the organized sector.
Under this scheme, both the employee and the employer contribute to the employee’s retirement savings.
According to EPFO “The employee will no longer be a member of the Pension Fund from the date of reaching the age of 58 or from the date of receiving accepted benefits under the Program.”
EPS was introduced in 1951. The organization states “The Employees Provident Fund came into existence after the enactment of the Employees Provident Fund Ordinance on November 15, 1951. It was replaced by the Employees Provident Fund Act, 1952.”
What is the higher pension scheme?
EPFO recently announced changes to the Higher Pension Scheme under EPS.
Web circular from EPFO states “(i) For members who have exercised their right to elect general contributions under the provisions of paragraph 11 of the Employees Pension Scheme 1995 and who are otherwise eligible, the employer contribution rate shall be is nine percent and forty-nine percent. (9.49%) of each member’s basic salary, unlimited benefits and retention benefits according to
increased by one sixteenth. (1.16%) compared to the remaining 8% and 1/3. (8.33%);
“And (ii) the increased contribution shall be applicable to the basic salary, unlimited allowance and retention allowance to the extent that the basic salary, unlimited allowance and retention allowance exceed fifteen thousand rupees every month.”
According to this circular, EPFO is expected to receive an additional 1.16% contribution from the employer’s EPF contribution. This means that workers will still enjoy higher pensions.
However, the capital allocation for the Employee Provident Fund (EPF) and Employee Pension Scheme (EPS) will be changed. This will result in a decrease in EPF volume and an increase in EPS balance.
Who is eligible for a higher pension?
According to the Supreme Court order, an employee is eligible for a higher pension if:
- Employees retired on September 1, 2014 and are contributing more to their EPF accounts. However, their demand for higher contribution was rejected by EPFO.
- This employee was a member of EPS or EPF on 1 September 2014 and continued to be a member of the scheme after their retirement.
This circular clearly states: “44 (iii) Employees who have exercised their option under the provisions of paragraph 11(3) of the 1995 scheme and who continue to work from 1 September 2014, shall be guided in accordance with the regulations amendment of paragraph 11(4) of the pension scheme”.
“44(iv) Members of the scheme, who did not exercise the option, as contemplated in the provisions of paragraph 11(3) of the pension scheme (as before 2014 Amendment) shall have the right to exercise the option pursuant to paragraph 11(4) of the article revised diagram.
“Their right to exercise their option before September 1, 2014 is evident in the judgment of this Court in RC Gupta case (supra).
“The program effective before September 1, 2014 does not stipulate any expiration date and Those members will therefore be entitled to exercise the option under paragraph 11(4) of the scheme as it currently stands.
“Their exercise of the option will be in the nature of general options including the pre-amended paragraph 11(3) as well as the amended paragraph 11(4) of the pension scheme.
“There is uncertainty about the validity of the post-amendment scheme, which has been quashed by the aforesaid judgments of the three Supreme Courts.
“Thus, all employees who do not exercise their options but have the right to exercise them but cannot exercise due to the authorities’ interpretation of the expiration date must be given an additional opportunity to exercise their options. .
“The period for exercising the option under paragraph 11(4) of the scheme shall, in these circumstances, be extended by a further four months. We are giving this direction in implementation Our jurisdiction under Article 142 of the Constitution of India. Remaining requirements according to the amended regulations will be implemented.
Furthermore, EPFO mentioned that “The field office will examine each case and classify it into the following categories:
- The fees charged have been paid in full to EPS for the months due
- The fees charged have not been transferred to EPS but the contribution towards higher salary has been fully transferred to EPF and there is sufficient balance in the PF account.
- The fees charged have not been transferred to EPS but the contribution towards higher salary has been transferred entirely to EPF and there is not enough balance in the PF account or PF account held in trust by PF exempt establishments. ”
How to apply for a higher pension scheme?
Eligible employees can apply for higher pension claim through the online portal by following the steps listed below or by visiting the regional EPF office.
- EPFO has provided the option to register for the program online through its EPFO Portal
- After accessing the website, the user has to click on the “Pension with higher salary” option.
- The user then has to fill in the details and submit the form
- Once submitted, the website will register the information and provide a receipt to the applicant.
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Source: pagasa.edu.vn