Daijiworld Media Network – New Delhi
New Delhi, Jul 2: The Centre has notified the Employees' Provident Fund (EPF) Scheme, 2026, replacing the EPF Scheme, 1952, while retaining the existing contribution rates and introducing clearer rules on mandatory and voluntary contributions.
The new scheme came into effect on Jun 29 after being published in the Gazette and is expected to simplify and modernise the EPF system for nearly eight crore active subscribers of the Employees' Provident Fund Organisation (EPFO).
One of the key changes is the clarification that the mandatory employee contribution applies only up to the statutory wage ceiling of Rs 15,000 per month.
Under the revised rules, the compulsory employee contribution remains 12 per cent of Rs 15,000, amounting to Rs 1,800 per month. Employers will continue to make a matching contribution as required under the law.
The scheme also clearly distinguishes between mandatory and voluntary contributions. Employees can continue contributing more than the statutory limit towards their retirement savings, but any contribution above Rs 1,800 a month will be treated as voluntary.
The government clarified that employers will not be required to match these additional voluntary contributions unless such a provision exists under an employment contract or company policy.
The overall EPF contribution rates remain unchanged, with both employees and employers continuing to contribute 12 per cent of wages. Establishments already eligible for the reduced 10 per cent contribution rate under existing government notifications will continue under the same arrangement.
The EPF Scheme, 2026, also simplifies partial withdrawal rules by grouping them into three broad categories. Members will be allowed to withdraw funds for essential needs such as illness, education and marriage, for housing-related purposes, and under certain special circumstances, subject to prescribed conditions and minimum balance requirements.
Another major feature of the new scheme is its emphasis on digital services. It promotes electronic filings, online claim processing, e-passbooks and wider integration of the Universal Account Number (UAN), with the aim of making EPF services faster, more transparent and easier to access.
The government said the new scheme is intended to modernise India's provident fund system while preserving existing retirement benefits. For most salaried employees, the changes provide greater clarity on compulsory and voluntary contributions without altering the basic PF contribution rate.