EPF SCHEME

EMPLOYEES’ PROVIDENT FUND EMPLOYEES’ PENSION SCHEME

(EPF) (EPS)
12% OF EMPLOYEE CONTRIBUTION 8.33% STATUTORY WAGE CEILING
+ i.e Rs 15000
12% EMPLOYER CONTRIBUTION-PENSION 8.33% of 15000=Rs 1250
CONTRIBUTION
What is Higher EPF Pension
As per Hon’ble Supreme Court’s order in civil Appeal No(s) 10013-
10014 of 2016 arising out of SLP NO 33032-33033 of 2015

All members of the EPS 95 the benefit of the actually salary in the
pension exceeding wage limit of Rs 15000/- per month.
Member get benefit by contributing 8.33% of actual salary instead of
ceiling salary

Current EPS
Pension contribution is 8.33% of ceiling salary i.e
8.33% 0f Rs 15000/= Rs 1250

Higher EPS
Pension contribution is 8.33% of actually salary

In both the cases the pension contribution is from 12% of employer

contribution only.
Amount deposited in EPF
Current EPS
The amount deposited in the EPF account is

12% salary of Employee contributed by Employee + (12% salary of

employee contributed by employer-Rs 1250)

8.33% of 15000=1250
Higher EPS
12% salary of Employee contributed by Employee + 3.37% salary of
employee contributed by employer
8.33% salary of employee contributed by Employer is deposited in EPS

The amount deposited in the EPF account is more in current EPS option
The amount deposited in the EPS account is more in Higher EPS option

There is interest on the deposited amount in the EPF

There is no interest on the deposited amount in the EPS
Pension Formula

Current EPS

15000(ceiling salary ) * Pensionable service/70

Ex 15000*35/70 = 7500

Higher EPS
Avg of 60 months salary * Pensionable service/70

Ex 100000*35/70 = 50000

Take a case study

 Basic and 100 % DA merged in 3rd PRC and 4th PRC

Higher
Current EPS
Current EPS Higher EPS EPS

EMPLOY ER. ER.

IDA BASIC+D E EPF EMPLOY PENSIO EMPLOY EMPLOY PENSIO EE+ER EE+ER
BASIC RATE DA A CONT ER . EPF N EE ER N EPF EPF
Jan-17 52520 19.5 10241 62761 7531 6281 1250 7531 2303 5228 13812 9835
Feb-17 52520 19.5 10241 62761 7531 6281 1250 7531 2303 5228 13812 9835
Mar-17 52520 19.5 10241 62761 7531 6281 1250 7531 2303 5228 13812 9835
Apr-17 52520 17.1 8981 61501 7380 6130 1250 7380 2257 5123 13510 9637
May-17 52520 17.1 8981 61501 7380 6130 1250 7380 2257 5123 13510 9637
Jun-17 52520 17.1 8981 61501 7380 6130 1250 7380 2257 5123 13510 9637
Jul-17 52520 19 9979 62499 7500 6250 1250 7500 2294 5206 13750 9794
Aug-17 52520 19 9979 62499 7500 6250 1250 7500 2294 5206 13750 9794
Sep-17 52520 19 9979 62499 7500 6250 1250 7500 2294 5206 13750 9794
Oct-17 52520 21 11029 63549 7626 6376 1250 7626 2332 5294 14002 9958
Nov-17 52520 21 11029 63549 7626 6376 1250 7626 2332 5294 14002 9958
Dec-17 52520 21 11029 63549 7626 6376 1250 7626 2332 5294 14002 9958
 OPTION OPTION
OPTION 1 OPTION 2 1 2

EMPLOY ER. ER.

IDA BASIC+D E EPF EMPLOY PENSIO EMPLOY EMPLOY PENSIO EE+ER EE+ER
BASIC RATE DA A CONT ER . EPF N EE ER N EPF EPF
Jan-35 173603 58 100690 274293 32915 31665 1250 32915 10067 22849 64580 42982
Feb-35 173603 58 100690 274293 32915 31665 1250 32915 10067 22849 64580 42982
Mar-35 173603 58 100690 274293 32915 31665 1250 32915 10067 22849 64580 42982
Apr-35 173603 60 104162 277765 33332 32082 1250 33332 10194 23138 65414 43526
May-35 173603 60 104162 277765 33332 32082 1250 33332 10194 23138 65414 43526
Jun-35 173603 58 100690 274293 32915 31665 1250 32915 10067 22849 64580 42982
Jul-35 173603 60 104162 277765 33332 32082 1250 33332 10194 23138 65414 43526
Aug-35 173603 60 104162 277765 33332 32082 1250 33332 10194 23138 65414 43526
Sep-35 173603 60 104162 277765 33332 32082 1250 33332 10194 23138 65414 43526
Oct-35 173603 62 107634 281237 33748 32498 1250 33748 10321 23427 66246 44070
Nov-35 173603 62 107634 281237 33748 32498 1250 33748 10321 23427 66246 44070
Dec-35 173603 62 107634 281237 33748 32498 1250 33748 10321 23427 66246 44070
38472361 4616670 4220930 395740 4616683 1411936 3204748 8837600 6028619
 Current EPS Higher EPS
Pensionable Salary 15000 242450
(Avg salary of 60 months)
Suppose in above example
employee serves for 33 years. 35 35
(i.e. Two years extra if service
is more than 20 years)

Pension= 15000X35/70 242450X35/70

(Pensionable Salary
X years of service)/70 = 7500 121225

EPF Fund Value under both

options on simple 8% interest 24745280 16880133

Differential amount in current EPS 7865147

 DIFF. DIFF. DIFF. DIFF. DIFF.
Pension Pension Pension Pension Pension @4% @6% @8% @10% @12%
+ Intt. On + Intt. On + Intt. On + Intt. On + Intt. On FIXED (OPTION (OPTION (OPTION (OPTION (OPTION
Diff. Diff. Diff. Diff. Diff. PENSION 1 - 1- 1- 1- 1-
Fund Fund Fund Fund Fund UNDER OPTION OPTION OPTION OPTION OPTION
@4% @6% @8% @10% @12% OPTION 2 2) 2) 2) 2) 2)
IF ALIVE UPTO 1 YEARS AFTER RETIREMENT 8269753 8427056 8584358 8741661 8898964 1454676 6815077 6972380 7129682 7286985 7444288
IF ALIVE UPTO 2 YEARS AFTER RETIREMENT 8674358 8988964 9303570 9618176 9932782 2909352 5765006 6079612 6394218 6708824 7023430
IF ALIVE UPTO 3 YEARS AFTER RETIREMENT 9078964 9550873 10022782 10494691 10966600 4364028 4714936 5186845 5658754 6130663 6602572
IF ALIVE UPTO 5 YEARS AFTER RETIREMENT 9888176 10674691 11461205 12247720 13034235 7273380 2614796 3401311 4187825 4974340 5760855
IF ALIVE UPTO 6 YEARS AFTER RETIREMENT 10292782 11236600 12180417 13124235 14068052 8728056 1564726 2508544 3452361 4396179 5339996
IF ALIVE UPTO 7 YEARS AFTER RETIREMENT 10697388 11798508 12899629 14000749 15101870 10182732 514656 1615776 2716897 3818017 4919138
IF ALIVE UPTO 8YEARS AFTER RETIREMENT 11101994 12360417 13618841 14877264 15101870 11637408 -535414 723009 1981433 3239856 3464462
IF ALIVE UPTO 10 YEARS AFTER RETIREMENT 11911205 13484235 15057264 16630293 18203323 14546760 -2635555 -1062525 510504 2083533 3656563
IF ALIVE UPTO 15 YEARS AFTER RETIREMENT 13934235 16293779 18653323 21012867 23372411 21820140 -7885905 -5526361 -3166817 -807273 1552271
IF ALIVE UPTO 20 YEARS AFTER RETIREMENT 15957264 19103323 22249381 25395440 28541499 29093520 -1.3E+07 -9990197 -6844139 -3698080 -552021
IF ALIVE UPTO 25 YEARS AFTER RETIREMENT 17980293 21912867 25845440 29778013 33710587 36366900 -1.8E+07 -1.4E+07 -1.1E+07 -6588887 -2656313
IF ALIVE UPTO 30 YEARS AFTER RETIREMENT 20003323 24722411 29441499 34160587 38879675 43640280 -2.4E+07 -1.9E+07 -1.4E+07 -9479693 -4760605

If your life expectancy is around 8 years after retirement, you are at break
even as per above sample calculation but LIFE IS UNCERTAIN.
3rd PRC & 4th PRC has not taken into consideration & in 2017 & 2027,100% DA has
been merged with Basic without any fitment to be on safer side. U can simulate after
changing the figures.
Terms And Conditions of EPS

You must have been in the service for at least 10 years.

One can get the pension after the age of 58. Reduced pension
can be withdrawn after the age of 50

You can also defer your pension till the age of 60. If you opt for
deferment, the pension would increase by 4% for every deferred
year.

The Pension is given to the family after the untimely death of

employee.

An employee can get a pension if s/he gets totally

incapacitated.
Know Your Reduced Pension

Age Factor To multiply

50 0.7837
51 0.808
52 0.833
53 0.8587
54 0.8853
55 0.9127

56 0.9409

57 0.97
58 1

Enhanced Pension After 58

In the reduced pension formula, the pension decreases by 4% for every year. Similarly,
you would get 4% more pension for every extra year. However, you can get only two such
years as this benefit is not available after the age of 60.
If VRS/CRS before 50 years of age

There is no pension till attending the age of 50 years in both

the cases. Pension is as per given above reduced table

If employee serviced for 15 years with Avg 60 months salary is

Rs 40000
Current EPS

Pension= 15000*no of years service/70

Ex =15000*15/70= 3214

Higher EPS

Pension= Avg 60 months salary *no of years service/70

Ex =40000*15/70= 8571

Differece 8571-3214 =5357

If VRS/CR before 50 years of age after serviced 20 years

There is no pension till attending the age of 50 years in both

the cases. Pension is as per given above reduced table

If employee serviced for 20 years with Avg 60 months salary is

Rs 100000
Current EPS
Pension= 15000*no of years service/70
Ex =15000*22/70= 4714
At the age of 50 years Pension =4714*78/100=3676
Higher EPS
Pension= Avg 60 months salary *no of years service/70
Ex =100000*22/70= 31,428
At the age of 50 years Pension =31428*78/100=24513

Differece 24513-3676 =20837

Jan-22 60882 55 33485 94367 11324 10074 1250 11324 3463 7861 21398 14787

Feb-22 60882 55 33485 94367 11324 10074 1250 11324 3463 7861 21398 14787

Mar-22 60882 55 33485 94367 11324 10074 1250 11324 3463 7861 21398 14787

Apr-22 60882 57 34703 95585 11470 10220 1250 11470 3508 7962 21690 14978

May-22 60882 57 34703 95585 11470 10220 1250 11470 3508 7962 21690 14978

Jun-22 60882 57 34703 95585 11470 10220 1250 11470 3508 7962 21690 14978

Jul-22 60882 59 35920 96802 11616 10366 1250 11616 3553 8064 21982 15169

Aug-22 60882 59 35920 96802 11616 10366 1250 11616 3553 8064 21982 15169
Sep-22 60882 59 35920 96802 11616 10366 1250 11616 3553 8064 21982 15169

Oct-22 60882 61 37138 98020 11762 10512 1250 11762 3597 8165 22274 15360

Nov-22 60882 61 37138 98020 11762 10512 1250 11762 3597 8165 22274 15360

Dec-22 60882 61 37138 98020 11762 10512 1250 11762 3597 8165 22274 15360
124054 228033 161994
10337847 1240539 1039799 200740 2 379399 861143 8 1
 Current EPS Higher EPS
Pensionable Salary 15000 81834
(Avg salary of 60 months)
Suppose in above example
employee serves for 33 years. 22 22
(i.e. Two years extra if service
is more than 20 years)

Pension= 15000X22/70 81834X22/70

(Pensionable Salary
X years of service)/70 = 4714 25710

EPF Fund Value under both

options on simple 8% interest 6384946 4535834

Differential amount in current EPS 1849113

 Pensio
n+
Intt.
On
Diff. Pension + Intt. Pension + Intt. Pension + Intt. Pension + Intt. FIXED PENSION DIFF. @4% DIFF. @6% DIFF. @8% DIFF. @10% DIFF. @12%
Fund On Diff. Fund On Diff. Fund On Diff. Fund On Diff. Fund UNDER OPTION (OPTION 1 - (OPTION 1 - (OPTION 1 - (OPTION 1 - (OPTION 1 -
@4% @6% @8% @10% @12% 2 OPTION 2) OPTION 2) OPTION 2) OPTION 2) OPTION 2)

IF ALIVE UPTO 1 YEARS 197964

AFTER RETIREMENT 5 2016628 2053610 2090592 2127574 308628 1671017 1708000 1744982 1781964 1818946

IF ALIVE UPTO 2 YEARS 211017

AFTER RETIREMENT 8 2184142 2258107 2332071 2406036 617256 1492922 1566886 1640851 1714815 1788780

IF ALIVE UPTO 3 YEARS 224071

AFTER RETIREMENT 0 2351657 2462604 2573551 2684497 925884 1314826 1425773 1536720 1647667 1758613

IF ALIVE UPTO 5 YEARS 250177

AFTER RETIREMENT 5 2686687 2871598 3056509 3241420 1543140 958635 1143547 1328458 1513369 1698280

IF ALIVE UPTO 6 YEARS 263230

AFTER RETIREMENT 8 2854201 3076095 3297988 3519882 1851768 780540 1002433 1224327 1446220 1668114

IF ALIVE UPTO 7 YEARS 276284

AFTER RETIREMENT 0 3021716 3280592 3539468 3798343 2160396 602444 861320 1120196 1379072 1637947

IF ALIVE UPTO 8YEARS 289337

AFTER RETIREMENT 3 3189231 3485089 3780947 3798343 2469024 424349 720207 1016065 1311923 1329319

IF ALIVE UPTO 10 YEARS 315443

AFTER RETIREMENT 8 3524260 3894083 4263906 4633728 3086280 68158 437980 807803 1177626 1547448

IF ALIVE UPTO 15 YEARS 380710

AFTER RETIREMENT 0 4361834 4916568 5471302 6026036 4629420 -822320 -267586 287148 841882 1396616

IF ALIVE UPTO 20 YEARS 445976

AFTER RETIREMENT 3 5199408 5939053 6678698 7418343 6172560 -1712797 -973152 -233507 506138 1245783
Family pension
If employee serviced for 15 years with Avg 60 months salary is Rs
40000
Current EPS
If Member death in service
Family pension=( 15000*no of years service/70 )/2
Ex =(15000*15/70)/2= 1607
If Member death after retirement
Ex =(15000*35/70)/2= 3750
Higher EPS
If Member death in service

Family pension=( Avg 60 months salary *no of years service/70 )/2

Ex =(40000*15/70)/2= 4285
If Member death after retirement
Ex(above case study) =(242450*35/70)/2= 60612

Diffrence in case1 4285-1607=2678

case2 60612-3750=56862
Suppose at present 10 lakh by employee and 10 lakh by employer have been
deposited in epf in last 15 years

In current EPS pension contribution deposited is

=6500*8.33%*no of Months*no of years+15000*8.33%*no of Months*no of
years
=6500*8.33%*12*12+15000*8.33%*12*3
=123048
Amount deposited in EPF account =1000000+(1000000-123048)
=1876952
If we opt to Higher EPS

As per above case study

Amount deposited in EPS account = 431051
Amount deposited in EPF account =1000000+(1000000-431051)
= 1568949
Arrear to be transferred from epf fund to EPS fund
431051-123048 =308003
Note this is without considering interest
If there are any surviving children of the deceased member, falling within a
definition of family, they shall be entitled to a monthly children pension in
addition to the monthly widow/widower pension.

Monthly children pension for each child shall be equal to 25 per cent of the
amount admissible to the widow/widower of the deceased member

Monthly children pension shall be payable until the child attains the age of 25
years

The monthly children pension shall be admissible to maximum of two children


If bsnl continue to give us Low Pension
regular increment and ida
till our retirement
if bsnl not able to give
regular increments and
ida till retirement or in
last 5 years of our service
or VRS/CRS
If Govt. imposes taxes on
EPF amount withdraw at
the time of retirement
EPF interest rates less
Current EPS
EPF Amount is more
EPS amount is Low
Access EPF AMOUNT
would help at the time of
retirement /VRS/CRS
More tax on our EPF
amount
less pension and less
interest will be heavy loss
in EPF Amount
Higher EPS
Very High Pension
pension will be low as per
last 5 years wages and EPF
amount will also be lower
than current EPS
Less Tax
higher pension every
month give comfortable
fund in our hand
 Current EPS Higher EPS

if employee & spouse are Low Pension will effect Very High Pension will
alive till 75 years of age daily life give happy life
if employee & spouse are High accumulated EPF Next generation and our
alive till 65 years of age amount will help next children above age 25
generation years will not got any
pension. We have
invested lakhs of rupees
in 35 years of service but
not enjoyed pension for
long time
Any emergency higher epf amount could Not possible
requirement be withdrawn at the time
of Emergency
Who are eligible for this Higher pension ?

All employees who are joined before 1st September 2014

If any employee withdraw EPF amount is eligible for this Higher Pension?

If employee is ready to repay the amount is eligible for this higher pension

How to apply this Higher Pension?

A joint option form of Employee and Employer has to submit to Concern EPF Office
If our JOB continue till 58 years

higher pension option will provide higher pension so no need to plan anything
else for retirement, we can enjoy our current salary in present time , no worry
about future

In current EPS low pension option need some other retirement planning like
NPS from now on wards

if we think with positive attitude Higher EPS is very good option

For any quarries contact me

G ACHESWARA RAO
ACS SNEA AP CIRCLE
9440279969