The Employee Provident Fund (EPF) is a mandatory retirement savings scheme for salaried employees in India, governed by the EPFO. Both employee and employer contribute 12% of basic salary + DA each month. The EPF calculator helps you estimate your total PF corpus at retirement based on your current salary, contribution rate, and expected salary increments.
Employee vs Employer EPF Contribution
The employee contributes 12% of basic salary + DA to EPF. The employer also contributes 12%, but this is split: 3.67% goes to EPF and 8.33% goes to the Employees' Pension Scheme (EPS). For salaries with a basic above ₹15,000, the EPS contribution is capped at ₹1,250/month. The current EPF interest rate is 8.25% p.a. (FY 2023-24).
How EPF Interest Is Calculated
EPF interest is calculated monthly on the running balance and credited annually on March 31. The monthly rate is 1/12 of the annual rate. New deposits made in March don't earn interest for that month — they start from April of the next financial year. This makes EPF one of the most consistent wealth-building instruments for Indian employees.
EPF Withdrawal Rules
Full withdrawal is allowed on retirement (age 58) or after 2 months of unemployment. Partial withdrawals are permitted for home purchase (after 5 years), medical treatment, marriage (after 7 years), and education. Withdrawals before 5 years of continuous service attract TDS at 10% (30% without PAN).
Frequently Asked Questions
Is EPF mandatory for all employees?
EPF is mandatory for employees earning up to ₹15,000/month basic salary in establishments with 20+ employees. Employees earning more can opt in voluntarily.
What is the difference between EPF and EPS?
EPF accumulates a corpus you receive on retirement. EPS provides a monthly pension after retirement based on years of service and salary.
What is the current EPF interest rate?
The EPFO declared an interest rate of 8.25% per annum for FY 2023-24. The rate is set annually by the EPFO's Central Board of Trustees.
Can I continue EPF if I switch jobs?
Yes. Transfer your EPF balance to your new employer's account using the online transfer facility on the EPFO member portal. Avoid withdrawing EPF on job change — it breaks compounding and attracts tax.
Is EPF taxable?
Contributions up to ₹1.5 lakh qualify for Section 80C deduction. Interest on contributions up to ₹2.5 lakh/year (₹5 lakh for government employees) is tax-free. Maturity proceeds after 5 continuous years of service are fully tax-free.