When commencing a business, businessmen have multiple choices as to the kind of business entity that they can form. The Indian Company Law gives options including Private Limited Company, Public...
EPF, an acronym stands for Employees Provident Fund states that welfare of the employees is the welfare of the company. It is absolutely true that your company will definitely grow if your employees are happy. For the welfare of the employees, government introduces various schemes and EPF in India is one of them. It provides various financial facilities to the employees during the time of their retirement. It not offers security to the employees but also to their family members and nominees.
To know more about EPF, its benefits and how to register this in India, let’s read out more.
EPF Registration in India
Employees Provident Fund is a scheme that is governed by the EPFO (Employees Provident Fund Organization). It runs under Employees’ Provision Funds and Miscellaneous Provisions Act, 1952. EPF is a scheme that offers benefits to the employees by their employers at the time of their retirement. Those establishments where more than 20 employees are working have to register under the Employees Provision Scheme.
The contribution is 12% of the basic wages including dearness allowances and retaining allowances. It is 10% if in case the company is doing voluntary registration with less than 20 employees in the organization.
Benefits of EPF Registration in India
- Employees who completed the age of 58 years with 10 years of service can get all the pension benefits without any withdrawal.
- At the time of resignation, the employer can settle all the accounts by receiving his provident funds, employee’s contribution funds, and contribution.
Benefits of Insurance
The organization should contribute some funds as a premium on a monthly basis in the account of the employee. As per Employee Deposit Linked Insurance Scheme, This contribution by the organization may definitely benefit the employees in their future.
Benefits of Pension
- On the death of the employee, his/her family members will get all the pension benefits. For this, the details of the family members need to fill in the form.
- Scheme Certificate- this certificate generally issues to those employees who are retired from the company before attaining the age of 58 years. This scheme is far better than withdrawal from the pension account.
Benefits of withdrawal
- Those employees who do not attain the age of 58 years and are not eligible for a pension can withdraw their amount from the pension account.
- The calculation of the withdrawal account depends on the last average salary of the employee and his/her service instead of total pension funds.
- The Employees Provident fund Organization provides facilities to all the employees even if the person is not registered.
After Death benefits
- After the death of the employee, the family members will get all the EPF benefits.
- All the family members or employee’s nominee are entitled to get the benefits after the employee’s death.
- Family members are also entitled to receive insurance amounts.
- The employee needs to fill FORM-2, to make his nominee.
- The employees can withdraw 50% from their savings amount for the purpose of education or marriage of any family member.
- The members can also withdraw their amount at the time of purchase any property or their dream house. The employees can withdraw up to 12 months of their salary to make such purchases.
- Employees can also withdraw an amount six times of his salary for any medical emergency even of their family members.
Eligibility criteria for EPF Registration in India
- The employer should register for EPF if a number of employees in a factory or establishment is more than 20.
- When Central Government issues any notice to register for EPF in the official gazette for an establishment with less than 20 employees.
- Establishments with less than 20 employees received notice for compulsory registration for not less than 2 months.
- If an establishment with less than 20 employees wants to do registration, then they can choose voluntary registration with a 10% deduction rate.
Documents Required for EPF Registration in India
Documents Required of Companies
- Incorporation Certificate of the Company
- Office Address Proof (Property papers, Rent agreement, Possession Letter)
- Article of Association
- Memorandum of Association
- Identity Proof of Directors (PAN card, Aadhar Card)
- Address Proof of Directors (Voter ID card, Passport)
- Details of the company
- GST Registration number of the company
- Digital Signature Certificate of Directors
- Digital Identification Number of Directors
Documents Required of Employees
- Name of the employees
- Date of Birth of employees
- Postal Address of the employees
- Father’s name of the employees
- Joining date of the employees
- Contact number of the employees
- Name of employee’s nominees
- Designation of employees
- Salary of the employees
- Employment agreement
- Voluntary application
- Bank account number with the IFSC code
- Other details of the employees, if any.
Other documents required for EPF registration in India
- First sales transaction bill of the company
- First raw materials purchase transaction bill of the company
- Provident fund and salary statement
- Cancelled cheque
- Balance sheet
- Monthly record of employees strengths
Procedure for obtaining EPF Registration in India
Step-1 Generating User Id and Password
The applicant firstly needs to visit the site of EPFO (Employees’ Provident Fund Organization) India and click on Establishment Registration. After clicking on Establish registration, the applicant will be redirected to the site of Shram Savidha, Ministry of Labor and Employment.
Then, the applicant can register himself by filing the Name, Email, Mobile number and Captcha to generate User Id and password.
Step-2 Accepting Terms and conditions
For Establishment registration, the applicant needs to read the User Manual thoroughly which contains all the important rules and instructions. The applicant can be preceded further only if he accepts all the terms and conditions mentioned in the User Manual.
Step-3 Obtaining Digital Signature Certificate
Under the next step, the applicants need to obtain DSC (Digital Signature Certificate). DSC helps in filing and submitting fresh forms online. Employers who have already registered with their EPF can log in with their UAN (Universal Account Number) and password.
Step-4 Filing all the required details
The next step states that after obtaining DSC, the applicant can proceed further by agreeing on the User Manual instructions and fill all the required details of both employer and the employee. The information regarding both parties’ names, address, PAN no.etc. need to be filled correctly. The questions contain red star are mandatory to be answered.
Step-5 Procedure for filing details
- The applicant first needs to enter his/her name first including middle and last name as mentioned in the Income Tax statements.
- After that, the employer should enter his PAN card number which will verify is identity and check whether he is registered earlier or not.
- After entering his PAN no., he can proceed further by filling his username. This username will help the employer to log in for his application.
- Then users have to choose the hint question and answer which could be asked if he forgets his password.
- After, the applicant needs to enter the mobile number to generate OTP and E-mail to verify the email address of the applicant.
Hence, it is the compulsion for all the business establishments where more than 20 employees are working have to register under EPF in India. Employers have to register under EPF for the financial security of their employees. Employees will be loyal towards an organization if they know that the company is providing full financial security to them and as well as to their family members. So, register for EPF today for the welfare of your employees.