Understanding EDLI Contributions: Should It Be on Full Basic Salary or the Rs.6,500 Ceiling?

Understanding EDLI Contribution: Full Basic Salary vs. Ceiling

Please explain the EDLI contribution on the full basic salary or on the ceiling as mentioned on the EPFO website, i.e., Rs.6,500/-. If the EDLI contribution is deposited on the full basic salary, are there any advantages from the authorities, or if paid on the ceiling (Rs.6,500/-) as mentioned on the website, are there any advantages? Please explain.

Enclosed is the EPFO EDLI Ceiling on the point (c).

Regards,

Even if you may opt for EDLI on a higher amount, the maximum compensation payable to an employee in case of his death while in employment (the very purpose of the scheme) would be limited to Rs. 100,000. Therefore, you should restrict the payment of EDLI based on a salary of Rs. 6,500.

Regards,
Madhu.T.K

Dear Madhu,

Even if you may claim EDLI on a higher amount, the maximum compensation payable to an employee in case of his death while in employment (the very purpose of the scheme) would be limited to Rs. 100,000. Therefore, you should restrict the payment of EDLI on a salary of Rs. 6,500.

Regards, Madhu.T.K

EDLI Claim in Case of Employee Death

I just wanted to ask, in case of the death of an employee, what is the amount that can be claimed from EDLI or what is the amount fixed by EDLI, and which form is required to claim?

Regards, Prerna

[Email Removed For Privacy Reasons]

In case of death, the amount payable shall depend on his contribution to the fund, and that is why EDLI is Employees' "Deposit Linked" Insurance. Therefore, depending upon service, the amount varies, and the maximum amount payable is Rs 1 lakh.

Regards,
Madhu.T.K

EDLI contributions are calculated based on the EPS salary, with a cap of 6,500 or basic + DA, whichever is lower.

Regards,
jmraju

Understanding EDLI Contribution

As per the Employees' Deposit-Linked Insurance (EDLI) Act of 1976, there is a benefit for employees which will be paid by the employer, i.e., 0.5% of basic wages on the challan.

Thanks and Regards,
Ashish
[Phone Number Removed For Privacy Reasons]

The EDLI amount for a deceased employee is calculated based on the PF contribution and basic wages of the employee. To claim EDLI, you need to submit Form 5IF. This form is available at epfindia.com or any PF regional office.

Regards,
Shafi

Understanding the Employees' Deposit Linked Insurance (EDLI) Scheme

EDLI is the abbreviation for the Employees' Deposit Linked Insurance Scheme. Here, "deposit" refers to the average deposit in the Employees' Provident Fund (EPF). When an employee dies while in service, the family receives compensation based on the employee's deposit. To make a claim, the employer must pay 0.5% as a premium.

Determination of Deposit

The average deposit of the last twelve months, as well as the total service, will be calculated, and whichever is less will be used for the calculation.

Determination of Compensation

- Up to Rs. 50,000, the actual amount will be received.
- Beyond the first Rs. 50,000, 40% of the remaining amount will be received, subject to a ceiling of Rs. 100,000.

Examples

- Example a) Deposit Rs. 100,000:
For the first Rs. 50,000 - Rs. 50,000
Next Rs. 50,000 - Rs. 20,000
Total - Rs. 70,000 (the full amount is received as it does not exceed Rs. 100,000).

- Example b) Deposit Rs. 200,000:
For the first Rs. 50,000 - Rs. 50,000
Next Rs. 150,000 - Rs. 60,000
Total - Rs. 110,000 (only Rs. 100,000 is received as it exceeds Rs. 100,000).

- Example c) Deposit Rs. 300,000:
For the first Rs. 50,000 - Rs. 50,000
Next Rs. 250,000 - Rs. 100,000
Total - Rs. 150,000 (only Rs. 100,000 is received as it exceeds Rs. 100,000).

There are better insurance schemes available with the same premium, even without considering the deposits. With these improved benefits, some organizations are exempted from EDLI and provide alternatives. Some schemes specify Rs. 102,000 for natural death and double benefits for accidental death.

Regards,
Abbas P.S., ITI Ltd, Palakkad 678 623.
Ph. [Phone Number Removed For Privacy Reasons]

EDLI contribution should be paid on the maximum ceiling of 15,000 or actual Basic + DA.

Dear Vikas,

The EDLI contribution is calculated by the portal for all employees mentioned in ECR-EDLI Wages. EDLI Wages refer to the actual EPF wages up to the maximum present ceiling of Rs15,000.

For example:
- EPF Wages: 20,000, EDLI Wages: 15,000
- EPF Wages: 10,000, EDLI Wages: 10,000

I hope this clarifies the calculation process for you.

Thank you.

My father recently passed away. He worked as a security guard and had an ESI card, but the security agency said we won't receive any EDLI amount. Why didn't they provide any reason? Please help me. What action can I take?