Dear friends,
After years long waiting, EPFO has released the circulars on minimum pension as Rs. 1000 and ceiling as Rs. 15000.
For those having a salary of Rs. 15000 and above, the following changes will be effected.
For those attaining 58 years on 30.9.2014, pension will be increased by Rs. 39, for an additional contribution of Rs. 709 (1250-541).
For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month.
For those attaining 58 years on 30.11.2016, pension will be increased by Rs. 1257, for 27 months contribution. i.e average of Rs. 46.50 for each month.
For those attaining 58 years on 30.11.2017, pension will be increased by Rs. 1894, for 39 months contribution. i.e average of Rs. 48.50 for each month.
For those attaining 58 years on 30.11.2018, pension will be increased by Rs. 2581, for 51 months contribution. i.e average of Rs. 50.60 for each month.
After 5 years contribution w.e.f 01.09.2014 (i.e after 31.08. 2019), Pension for pensionable service (i.e service after 16.11.1995) will be 30/13 (nearly 2.3) times.
Regarding EDLI.
Now the benefit in EPF is Rs. 130000 which will be enhanced to R. 360000.
For in lieu of EDLI (with Insurance companies),
Rs. 132000 for natural death will be increased to Rs. 362000 and Rs. 264000 for accidental death will become Rs. 724000.
Abbas.P.S
From India, Bangalore
517After years long waiting, EPFO has released the circulars on minimum pension as Rs. 1000 and ceiling as Rs. 15000.
For those having a salary of Rs. 15000 and above, the following changes will be effected.
For those attaining 58 years on 30.9.2014, pension will be increased by Rs. 39, for an additional contribution of Rs. 709 (1250-541).
For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month.
For those attaining 58 years on 30.11.2016, pension will be increased by Rs. 1257, for 27 months contribution. i.e average of Rs. 46.50 for each month.
For those attaining 58 years on 30.11.2017, pension will be increased by Rs. 1894, for 39 months contribution. i.e average of Rs. 48.50 for each month.
For those attaining 58 years on 30.11.2018, pension will be increased by Rs. 2581, for 51 months contribution. i.e average of Rs. 50.60 for each month.
After 5 years contribution w.e.f 01.09.2014 (i.e after 31.08. 2019), Pension for pensionable service (i.e service after 16.11.1995) will be 30/13 (nearly 2.3) times.
Regarding EDLI.
Now the benefit in EPF is Rs. 130000 which will be enhanced to R. 360000.
For in lieu of EDLI (with Insurance companies),
Rs. 132000 for natural death will be increased to Rs. 362000 and Rs. 264000 for accidental death will become Rs. 724000.
Abbas.P.S
From India, Bangalore
Dear Abbas
I have gone thru your posting and got some doubts about the calculations. For example how you arrived the following
"For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month"
Asok kumar
From India, Bangalore
I have gone thru your posting and got some doubts about the calculations. For example how you arrived the following
"For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month"
Asok kumar
From India, Bangalore
Dear Asok kumar,
In my above posting there is a slippage happened to me. Even though I have shown the salary as 15000, I was silent on the service. I feel that this will be the reason for your query.
In the above posting I have calculated based on service from the introduction of the Employees Pension Scheme, i.e w.e.f 16.11.1995. Now I shall come to the calculation shown in your query as "For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month"
Service from 16.11.1995 to 30.11.1995 = 20 years
Bonus on service = 2 years (for those complete 20 or more years, 2 years bonus will be given)
Total Pensionable service 20+2 = 22 - (1)
Pensionable salary is the average of last drawn 60 months.
Here 01.09.2014 to 30.11.2015, no. of months is 15 and total salary for this period is 15x15000 = 225000
Salary for balance 45 months (60-15) is 45x6500 = 292500
Salary for last 60 months is 225000+292500 = 517500
Average salary is 517500/60 = 8625 - (2)
Pensionable amount is Pensionable salary x Pensionable service / 70 = (1) x (2) / 70 = 8625 x 22 /70
= 2710.71 rounded to 2711 - (3)
Previous calculation with salary of 6500 is 6500 x 22 / 70 = 2042.86 rounded to 2043 - (4)
Difference (3) - (4), 2711 - 2043 = 668 for 15 months ( w.e.f 01.09.2014 to 30.11.2015)
One month average is 668/15 = 44.53.
Abbas.P.S
From India, Bangalore
In my above posting there is a slippage happened to me. Even though I have shown the salary as 15000, I was silent on the service. I feel that this will be the reason for your query.
In the above posting I have calculated based on service from the introduction of the Employees Pension Scheme, i.e w.e.f 16.11.1995. Now I shall come to the calculation shown in your query as "For those attaining 58 years on 30.11.2015, pension will be increased by Rs. 668, for 15 months contribution. i.e average of Rs. 44.50 for each month"
Service from 16.11.1995 to 30.11.1995 = 20 years
Bonus on service = 2 years (for those complete 20 or more years, 2 years bonus will be given)
Total Pensionable service 20+2 = 22 - (1)
Pensionable salary is the average of last drawn 60 months.
Here 01.09.2014 to 30.11.2015, no. of months is 15 and total salary for this period is 15x15000 = 225000
Salary for balance 45 months (60-15) is 45x6500 = 292500
Salary for last 60 months is 225000+292500 = 517500
Average salary is 517500/60 = 8625 - (2)
Pensionable amount is Pensionable salary x Pensionable service / 70 = (1) x (2) / 70 = 8625 x 22 /70
= 2710.71 rounded to 2711 - (3)
Previous calculation with salary of 6500 is 6500 x 22 / 70 = 2042.86 rounded to 2043 - (4)
Difference (3) - (4), 2711 - 2043 = 668 for 15 months ( w.e.f 01.09.2014 to 30.11.2015)
One month average is 668/15 = 44.53.
Abbas.P.S
From India, Bangalore
Dear Abbas,
Thanks a lot for sucj valuable posting.
However I am confused on the below information. can you please clarfiy the below statement:
"With effect from 01.09.2014, wherever employer and employees have
opted to contribute on salary exceeding Rs.6,500 per month, such employer
and employees will have to exercise a fresh option to contribute the
government’s share of 1.16% on the salary exceeding Rs.15,000 per month
from his/her contribution,” EPFO said in a circular to all its offices for
implementation"
Regrds.
Pranab Chakraborty
9404384433
From India, Mumbai
Thanks a lot for sucj valuable posting.
However I am confused on the below information. can you please clarfiy the below statement:
"With effect from 01.09.2014, wherever employer and employees have
opted to contribute on salary exceeding Rs.6,500 per month, such employer
and employees will have to exercise a fresh option to contribute the
government’s share of 1.16% on the salary exceeding Rs.15,000 per month
from his/her contribution,” EPFO said in a circular to all its offices for
implementation"
Regrds.
Pranab Chakraborty
9404384433
From India, Mumbai
Dear Pranab,
For a PF member, it is statutory to contribute to EPS on actual salary up to ceiling amount. But there was a provision to opt contribution on actual salary(i.e beyond ceiling limit) in accordance with the willingness of employee and employer. In such condition Government is not liable to contribute their share of 1.16%, as it is limited to ceiling salary. Previously the ceiling limit was 6500. Now ceiling hiked to 15000. As per the above notification, the said option is to be renewed, failing which the contribution will be limited on ceiling salary.
Abbas.P.S
From India, Bangalore
For a PF member, it is statutory to contribute to EPS on actual salary up to ceiling amount. But there was a provision to opt contribution on actual salary(i.e beyond ceiling limit) in accordance with the willingness of employee and employer. In such condition Government is not liable to contribute their share of 1.16%, as it is limited to ceiling salary. Previously the ceiling limit was 6500. Now ceiling hiked to 15000. As per the above notification, the said option is to be renewed, failing which the contribution will be limited on ceiling salary.
Abbas.P.S
From India, Bangalore
Hello Friends,
I run a small scale industry , we had an inspection from the PF dept and the officer has informed us that hence forth all allowances paid on a monthly basis except HRA will be treated as wages and allowances like conveyance allowance , special allowances will be subject to PF deduction.
The PF officer also informed us that HRA should be paid not exceeding 30% of basic salary.
Can any one throw some light on this subject
thanks
Raghuvir
From India, Madras
I run a small scale industry , we had an inspection from the PF dept and the officer has informed us that hence forth all allowances paid on a monthly basis except HRA will be treated as wages and allowances like conveyance allowance , special allowances will be subject to PF deduction.
The PF officer also informed us that HRA should be paid not exceeding 30% of basic salary.
Can any one throw some light on this subject
thanks
Raghuvir
From India, Madras
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
EPFO circular Enhancement of wage ceiling from 6500 to 15000 - 31Aug2014.pdf
A THEORETICAL STUDY ON ‘GLASS CEILING CONCEPT’.doc