Expertly ESI PF Consultant in Ahmedabad

Best ESI PF Consultant in Ahmedabad

Everything You Should Know About Employees' Pension Plans (EPS)

Employee Pension Plan: Employer Contributions Will Add An Additional 1.16%

Connect 2 Payroll Services in India, USA, and Global. Best ESI PF Consultant in Ahmedabad. The announcement about the Employee Pension Scheme recently made headlines states that employers would raise their contribution to the plan by 1.16%. Many employees are relieved about this development since it will mean they would have to make a larger contribution to their pension funds.

The Indian government launched the Employee Pension Scheme (EPS) as a retirement savings plan for workers in the organized sector. Both the employer and the employee contribute to the employee's retirement savings under the EPS.

Previously, the employer's share of the employee's basic pay (EPS) was set at 8.33%, with a monthly cap of Rs. 1,250. With the new declaration, the employer's share of the employee's basic income would now go toward the EPS at a rate of 9.49%, up to a monthly maximum of Rs. 1,800.

Employees' retirement savings will increase as a consequence of the increased contribution, which will be especially advantageous for those who would need to save enough money for retirement. Because the EPS system provides a safe and dependable means of saving for retirement, it is anticipated that this change will also encourage more employees to choose it.

The Employees' Pension Scheme (EPS): What is it?

Connect 2 Payroll Services in India, USA, and Global. Best ESI PF Consultant in Ahmedabad. The Employee's Provident Fund Organization (EPFO) runs the Employee Pension Scheme (EPS), a program with a focus on social security. This plan is for the pension of workers who leave the organized sector after fifty-eight years of service, upon retirement.

The benefits of this program are only available to employees who have worked for a minimum of ten years, whether continuously or intermittently. The EPS pension was introduced in 1995 and has since been maintained for both current and recently hired EPF employees.

Conditions of eligibility for EPS

In order for your workers to receive pension benefits under the workers' Pension Scheme, they must fulfill the following qualifying requirements. The person ought to:

Join the EPFO

ten full years of active service and an equivalent number of years of active EPF pension plan contributions

be at least 58 years old.

have reached the minimum age of 50 in order to receive a reduced rate of withdrawal from the EPS pension.

Delay taking the pension for two years, or until the person becomes sixty years old, in order to be eligible for the 4% yearly EPS pension.