EPFO Pension Scheme
EPFO Pension Scheme: EPFO claims that you are entitled to get a pension if you have made ten-year contributions to the PF account. The present EPFO guidelines state that the highest pensionable wage ceiling is Rs 15,000. Your pension fund can thus be filled with Rs 1,250 every month from Rs 15,000 x 8.33/100.
EPFO Pension Scheme: If you are employed and have a PF account, this question may have crossed your mind regarding the pension you would get upon retirement. Since the retirement age is up to 60 years, you should be aware of what the Employees Provident Fund Organisation (EPFO) advises at the time of retirement and how it is computed.
How funds are entered into the PF account? If you are employed in the private sector, 12% of your salary goes to your PF account. Your organisation makes the same contribution. However, only 8.33% of it is placed in the pension fund; the remaining 3.67% goes to PF.
Also Read:- EPFO New Update: Withdraw ₹1 Lakh Instantly via UPI – Big Relief for Members!
EPFO Pension Schme
What do the pension regulations state? EPFO claims that you are entitled to get a pension if you have made ten-year contributions to the PF account. At 50, you can claim a pension, but 4% will be deducted annually. Conversely, you obtain a full pension if you wait until you are 58 years old. If you do not claim a pension and postpone it until 60 years, there will be an increase of 4% annually. At the age of 60, you will collect more than 8% additional pension.
Method for pension computation The present EPFO guidelines state that the highest pensionable wage ceiling is Rs 15,000. That means your pension fund can be filled each month with Rs 15,000 x 8.33/100 = Rs 1,250. The pension computation is done using this formula:
Monthly Pension = (Pensionable Wage x Pensionable Service) / 70
At sixty years old, what pension will you be entitled to? If you start working at age 23 and retire at age 58, you would have worked for 35 years. Under these circumstances, pensionable pay is Rs 15,000, service length is 35 years, so the pension will be:
Rs 15,000 x 35 / 70 = Rs 7,500 monthly.
If you claim a pension at the age of 60, there will be a further boost of up to 8%. However, the computation of PF pension relies on your average pay during the past sixty months.
EPFO Pension Scheme: Rs 7,500 per Month Following 60 Years
- What is the revised EPFO pension plan?
Provided they satisfy the eligibility requirements and have paid into the Employees’ Pension system (EPS) throughout the years, members of the new EPFO pension system can get a monthly pension of Rs 7,500 beyond the age of 60.
- Who is eligible for this pension?
Those who have completed the necessary service years and contributed to the EPFO and EPS schemes will be eligible to get this pension once they are 60 years old.
- To be eligible for Rs 7,500 pension, how much should I pay to the EPFO?
The size of the pension depends on the EPF and EPS contribution made. Regular contributions to your EPF account ensure eligibility for Rs 7,500; the government guarantees this minimum pension for those meeting the criteria.
- Is there a minimum service requirement to qualify for this pension?
Yes, you must have a minimum of ten years of service under the Employees’ Pension Scheme (EPS) to be eligible for the pension.
- Can I claim a pension before sixty years?
No, the pension under this plan is available only after 60 years of age. There are no provisions for early payment.
- Is the Rs 7,500 pension fixed?
Yes, the pension amount is fixed at Rs 7,500 per month once eligibility criteria are met.
- Can the pension amount increase over time?
The Rs 7,500 is a minimum fixed pension. The actual amount may increase depending on total contributions, years of service, and future EPFO policy changes.
- How is the Rs 7,500 pension calculated?
The pension is calculated based on your average monthly income (pensionable salary) and the total years of membership in the EPS. Rs 7,500 is the minimum base pension for eligible members.
- Is the pension taxable?
Yes, the pension you receive from EPFO is subject to income tax as per the prevailing tax regulations.
EPFO Members: UPI lets you now withdraw up to Rs 1 lakh.
- What is the new EPFO UPI withdrawal feature?
EPFO members can now easily withdraw up to Rs 1 lakh from their EPF account using UPI (Unified Payments Interface). This new feature aims to speed up and simplify the withdrawal process.
- When will the UPI withdrawal feature be available?
The UPI withdrawal feature is expected to roll out by March 2025, though the exact date will be confirmed by EPFO.
- How can I withdraw money from my EPF account via UPI?
EPFO members must link their UPI ID to their EPF account. Once operational, members can log in to the EPFO portal or the UMANG app, select UPI as the withdrawal option, and receive funds directly in their bank account.
- How much can I withdraw using UPI?
Members can withdraw up to Rs 1 lakh using UPI. For higher amounts, conventional withdrawal methods will apply.
- Are there any charges for UPI withdrawals?
Currently, there are no additional charges for UPI withdrawals. It is advisable to stay updated with EPFO’s latest policies.
- Is the UPI withdrawal faster than traditional methods?
Yes, UPI withdrawals are much faster than traditional methods like cheque-based or bank transfers, which can take several days.
- How do I link my UPI ID to my EPF account?
You can link your UPI ID through the EPFO portal or the UMANG app. Ensure your UPI ID is connected to your bank account and matches your EPF details.
- Do I need additional documents for UPI withdrawals?
No additional documents are required if your UPI ID is linked to your bank account and meets EPFO’s eligibility criteria.
- What if I need to withdraw more than Rs 1 lakh?
For withdrawals exceeding Rs 1 lakh, you must use the traditional EPFO withdrawal process like NEFT or cheque.
- Can I use the UPI withdrawal feature outside India?
Currently, UPI services are only available in India, so international withdrawals are not supported.
- Is the UPI withdrawal feature secure?
Yes, UPI is a secure payment method with multiple layers of encryption and verification. EPFO ensures the same level of security for this process.
