EPF Calculator

EPF Calculator

EPF or Employees' Provident Fund is a government-driven way to influence working individuals to save for their retirement. Let's dig deeper into how this fund started and how it allows people to save for the betterment of their old age. The Employee's Provident Fund was launched by the Ministry of Labour & Employment in 1952. The ministry has been actively managing and implementing this fund since the time for the promotion of savings among the working professionals in the country

Understanding EPF

Explained below are a few important points that you must know about Employees' Provident Fund-

• As the law states, any business that has equal to or more than 20 employees is bound to enroll under the Employees' Fund Provident Organization
• There is only one individual EPF account for every employee
• Both the employer and the employee contribute 12% each of the employees' dearness allowance and basic salary to the EPF on a monthly basis
• Employees can withdraw a part of their EPF after a year of working, but only in case of emergency
• The employers of NGOs contribute 10% of the employee's dearness allowance and basic salary towards EPF
• The funds accumulated in the employee's EPF are accumulated with an interest of 8.5%
• EPF withdrawals made before 5 years of of employment are subject to a tax deduction of 10% of the employee's EPF balance

What is an EPF Calculator?

An EPF calculator lets you figure out the amount of money that will be accumulated in your EPF account upon your retirement. Using the EPF calculator, you can calculate the lump sum amount which consists of both your and your employer's contributions to your EPF account. This final amount derived using the EPF calculator will also include the accrued interest on your EPF investments.

How does the EPF Calculator Work?

Let's take an example to understand how the EPF calculator works-

Suppose, the employee, Mr. X's

Basic salary plus dearness allowance = Rs. 14,000

Contribution towards EPF = 12% * 14,000 = Rs. 1680

Employer's contribution towards EPF = 3.67% * 14,000 = Rs. 514

Employer's contribution towards EPS = 8.33% * 14,000 = Rs. 1,166

Now, the total contribution by Mr. X and his employer towards the EPF account = Rs. 1,680 + Rs. 514 = Rs. 2,194

Assuming the interest rate for financial year 2022-23 is 8.1%

So, the interest rate applicable for each month would be-

8.1%/12 = 0.675%

Now, assuming that the employee joined the Firm ABC in April 2019.

His total EPF contribution for April will be Rs. 2,194. Note that the EPF scheme will not pay any interest for April.

Total EPF contribution for the month of May = Rs 2,194+ Rs 2,194 = Rs. 4,388

Interest received = Rs. 4,388 * 0.70833% = Rs 31.08

The calculation would be done likewise for all the subsequent months. While this may seem too complicated, using an EPF calculator makes it one of the easiest ways to calculate your EPF balance. You simply need to enter a few details and your total accumulated EPF balance at the time of your retirement would be calculated in a few seconds!

How to Calculate Funds Using EPF Calculator?

To calculate your accumulated funds using EPF calculator, you need to enter a few details such as your current age, your basic monthly salary, dearness allowance, your contribution to the EPF, and your retirement age which should be up to 58 years. Upon entering these details in the EPF calculator, you will be able to see the total amount available in your EPF account upon your retirement.

Who should Invest in EPF?

Only the following employees are eligible to get their funds invested in EPF-

• Salaried employees with a monthly salary of Rs. 15,000 or more must register for an EPF account
• Organizations with equal to or more than 20 employees must enroll for the EPF scheme
• All the states and union territories in India, except for Jammu & Kashmir and avail the benefits of the EPF scheme

Check your EPF Balance Online

With advancements in technology, everybody wants things to be done online, at the comfort of their homes. And why not! When you can avail of innumerable benefits without having to step out of your house, such demands are quite justified.

Let's take a look at the online ways to check EPF balance-

EPFO Portal

You can check your EPF balance on the EPFO portal as and when your UAN gets activated. Once it is done, you simply need to follow these steps-

• Log in to the EPFO portal using your credentials
• Click on 'Our Services' tab
• From the dropdown menu, click on the option that says 'For employees'
• Next, under the tab of 'Services', click on the 'Member Passbook' option
• The next screen will display a login page, wherein you will have to enter your UAN and password
• Once you enter the correct details, you will be logged in to your EPF account
• From here, you can easily access your EPF passbook and find out your current EPF balance

UMANG Application

You can simply download the UMANG application, also known as the “m-Sewa app of EPFO” on your mobile device and check EPF balance. After downloading the application, follow these steps-

• Look for 'EPFO' option on the home screen under the section, 'Employee Centric Services'
• Click on 'Member' option, followed by “Balance/Passbook' option
• Now, enter your UAN and registered mobile number
• After successful verification of the entered details, you will be able to see your updated EPF balance
• However, if the provided UAN and mobile number are proven unlinked, the system will display a mismatch error message

Wrapping it Up:

EPF or Employees' Provident Fund is a government scheme set up by the EPFO under the guidance of the Ministry of Labor & Employment. The idea behind this scheme was to promote a sense of savings among the employees and to help them build a sufficient retirement corpus for their well being. Both the employers and employees contribute 12% of the employee's salary to EPF. Similarly, 12% of the employee's salary is deducted by the employer as a monthly contribution towards EPF.