Can Employees Deduct More Than 12% from Their PF? Exploring Limits and Possibilities

Hello All,

I am Pravin, working as an HR Officer. I want to know if someone wants to deduct more than 12% from his PF account, is it possible? If it is possible, then what is the limit of deduction?

Voluntary Provident Fund (VPF) Contribution

Yes, it is called the Voluntary Provident Fund. An individual can contribute beyond the standard 12% of their basic salary and dearness allowance that flows into the Employee Provident Fund (EPF) account every month. They can contribute up to 100% of the above components every month into the same Employee Provident Fund (EPF) account. There will be no separate account for the Voluntary Provident Fund (VPF). Any transfer or withdrawal of the Employee Provident Fund (EPF) account will automatically result in the transfer or withdrawal of the Voluntary Provident Fund (VPF) account as well.

The employer is only required to contribute 12%.

Shivianjay,

One point you need to remember: The Payment of Wages Act restricts the total deduction to 50% of gross wages (total of all deductions, not just PF). This also needs to be monitored and adhered to.