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Pensionable salary limit to be hiked from Rs 15,000 to 21000? EPFO decision to impact PF holders
Purporedly, members of EPFO are in favor of the increase in pensionable salary.
Highlights
- Increase pensionable salary limit likely.
- No change in limit since September 2014.
- EPFO members reportedly in favor of the increase in pensionable salary.
New Delhi: Retirement fund body Employees' Provident Fund Organisation (EPFO) is considering to increase the existing salary limit for pension that has not been changed since September 2014.
As per reports, EPFO is considering to increase the existing salary limit for pension from Rs 15000 to Rs 21000. Purporedly, members of EPFO are in favor of the increase in pensionable salary. The last amendment on the cap of pensionable salary was made in 2014 wherein the government had raised the PF salary limit from Rs 6500 to Rs 15000. (Also read: Planning to buy gold on Akshaya Tritiya 2022? Check 5 best ways to invest in gold)
On one hand, while the new limit will bring more people under the ambit, it will also make a burden for the government. The matter is currently awaiting government's green signal. It has been reported that for the hiked PF salary limit, government will have to bear an expenditure of 6,750 crores.
As per the present rates of contribution, in case an existing EPS member (as on 01-09-2014) whose Pension contribution was paid erstwhile EPS wage ceiling of Rs 6500 contribution to contribution above Rs 15000 wage ceiling from 01-09-2014 he/she will have to give a fresh consent and an amount of 1.16% on wages above Rs 15000 will have to be contributed by him in pension Fund (A/C No 10) through the employer.