Provident Fund Dilemma: Can You Stop Contributions with Employer's Consent?

Can an employee with a basic salary higher than 6500 stop contributing towards the provident fund with the employer's consent?

Those who are registered with EPF have to continue in PF until the end of service. The consent of the employee and employer has no role in discontinuing it.

Regards, Abbas.P.S

We can't stop the PF contribution from either side (employer, employee). If a newly joined employee has a basic salary exceeding 6500, we take a signature on Form 11, and then we are exempted from paying PF for such employees.

If the employee is already a member of PF, we should pay the contribution to EPFO.

Thanks & regards,
Bejji Guruvishnu

The employee and employer cannot stop contributions, but you can limit the same to Rs 780 per month.

Regards

Sir,

Provident Fund Contribution for Employees with Basic Salary Above 6500

1) If the basic pay is over 6500, the employer is not required to contribute to the Provident Fund for the concerned employee.

2) At their discretion, the employer can also volunteer to contribute PF to employees earning more than 6500 as basic pay.

3) If the employee does not wish to contribute due to a basic salary above 6500, they can stop the PF contribution after obtaining consent from the employer.

4) Based on my understanding, I have heard that if an employee contributes to PF for 10 consecutive years, they will be eligible for a reduced pension at the age of 50 and a full pension at the age of 58. So, why should an employee stop PF contributions?

Regards,
R. Dhamodhara Kannan [RDK]

As explained in the majority of posts above, the contribution cannot be stopped. The relevant rule provision is in Para 26A of the EPF Scheme. It is reproduced below for reference:

26A. Retention of Membership

(1) A member of the Fund shall continue to be a member until he withdraws under paragraph 69 the amount standing to his credit in the Fund or is covered by a notification of exemption under section 17 of the Act or an order of exemption under paragraph 27 or paragraph 27A.

Explanation: In the case of a claim for a refund by a member under subparagraph (2) of paragraph 69, the membership of the fund shall be deemed to have been terminated from the date the payment is authorized to him by the authority specified in this behalf by the Commissioner irrespective of the date of the claim.

(2) Every member employed as an employee other than an excluded employee, in a factory or other establishment to which this Scheme applies, shall contribute to the Fund, and the contribution shall be payable to the Fund in respect of him by the employer. Such contribution shall be in accordance with the rate specified in paragraph 29:

Provided that subject to the provisions contained in sub-paragraph (6) of paragraph 26 and [in paragraph 27], or sub-paragraph (1) of paragraph 27A, where the monthly pay of such a member exceeds [six thousand and five hundred rupees], the contribution payable by him, and in respect of him by the employer, shall be limited to the amounts payable on a monthly pay of [six thousand and five hundred rupees] including [dearness allowance, retaining allowance (if any) and] the cash value of the food concession].