Navigating PF Contributions for Employees Working Beyond 58: What Are the Rules?

Dear Friends,

One of our employees has attained the age of 58 on 15.12.24 (DOB 15.12.1966). We want to keep him continuing his job, and he is also willing to work. Now my question is:

Can we stop PF contribution after retirement?

1. Can we fully stop his PF contribution after 15.12.24 and still keep him on the salary sheet for the Dec '24 month and onwards, or does a separate sheet have to be made after 15.12.24 (two sheets: one before retirement and one after)?

Pension fund calculation date

2. Should the pension fund for the month of Dec '24 be calculated till 14.12.24 or 15.12.24?

Mandatory PF deduction after 58 years

3. Is it mandatory to keep deducting PF if an employee is continuing his job after 58 years, or can we stop it and still show it in our salary sheet since he has attained the retirement age? I know that the EPS contribution will cease, and 12% will be fully contributed to PF.

Thanks.

Kirti Bisht

Pension Fund Contributions After Retirement Age

You should stop Pension Fund contributions from December 15th. For this month, the contribution will only cover 14 days, from the 1st to the 14th. If you decide to keep the employee in service, you have two options: either halt PF contributions from December 15th or fully contribute the employer's share of 12% to the PF. For this month, you should treat the contributions separately, up to the 14th with Pension Fund contributions and from the 15th without Pension Fund contributions.

Exclusion from EPF

You can also exclude this employee from the EPF because they can be classified as an excluded employee. An employee receiving a pension from EPFO and an individual who has withdrawn their PF accumulation upon retiring at the age of 55 shall be considered excluded employees. While there are no restrictions on providing coverage, it is not mandatory. If PF coverage is provided, the employer's contribution should be fully allocated to the PF without dividing it as 8.33% to the Pension Fund and the remainder to the PF.

EPF Membership and Contributions After Age 58

Any EPF member is considered an EPF-covered employee until they receive their salary, regardless of age. However, after turning 58 years old, the full amount of both the EPF shares from the employee and the employer will be deposited into account numbers 1 and 2. The pension fund will be zeroed out.

The member cannot be treated as an excluded employee until they finally withdraw their EPF balance and officially mark their EPF exit with a date.

Dear Sramsoni,

You are right, and that is a perfect suggestion. The member cannot be treated as an excluded employee until he finally withdraws his EPF balance and marks EPF EXIT with a date.