Contribution more than 12% of Basic Salary Towards EPF

Can an employee contribute more than 12% of basic salary towards EPF:

Employees’ Provident Fund is a retirement investment plan that every salaried individual opts for. Employee usually contributes 12% of their basic pay and employer contributes 13.61% towards the Employee Provident Fund.

Benefits of having an EPF Account

The benefits of having an EPF account are as follows:

• Money will be accumulated till your retirement, resignation or death. You will also earn interest on the accumulated amount and you will also be eligible for the bonus.
• Partial withdrawal is allowed for meeting the expenses such as house construction higher education, marriage, illness, etc.
• It is the most tax-friendly tool that helps you build retirement corpus.
• If you withdraw the amount after working for 5 consecutive years, the amount will be totally exempt from tax under Section 80C of the Income Tax Act.
• The rate of interest for the financial year 2017-2018 has been declared at 8.65%.
• EPFO has decided to make all the payments to beneficiaries through the electronic modes.
• You can avail the Life Insurance cover, EDLI under EPF.
• To channelize the savings, SEBI and top stock exchanges have requested the new Central Government to allow a portion of the corpus in equities and mutual funds.
• SEBI has also suggested to invest the Rs.5.5 lakh crore managed by EPFO in equities and mutual fund.
• Bombay Stock Exchange has requested that the EPF money be assessed to both the primary and secondary markets.
• The SEBI and BSE investment will generate higher returns for the retired.