The Employees' Provident Fund Organisation has reduced the penal charges on employers who default on depositing the provident fund, pension, and insurance contributions of their employees with the retirement fund body. The penal charges are now uniform irrespective of the duration of default.
As per the notification issued by the Ministry of Labour on employment on Saturday, damages from the employer will be recovered at the rate of 1% of the arrear of contribution per month or 12% per annum across three schemes: the Employees' Pension Scheme (EPS), the Employees' Provident Fund (EPF) Scheme, and the Employees' Deposit Linked Insurance Scheme (EDLI) under EPFO. The highest charges so far were 25% per annum.
The new provision will be effective from 14/6/2024
Location: India
Tags: pension scheme, provident fund, Country-India
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As per the notification issued by the Ministry of Labour on employment on Saturday, damages from the employer will be recovered at the rate of 1% of the arrear of contribution per month or 12% per annum across three schemes: the Employees' Pension Scheme (EPS), the Employees' Provident Fund (EPF) Scheme, and the Employees' Deposit Linked Insurance Scheme (EDLI) under EPFO. The highest charges so far were 25% per annum.
The new provision will be effective from 14/6/2024
Location: India
Tags: pension scheme, provident fund, Country-India
From India
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The reduction in penal charges by the Employees' Provident Fund Organisation for employers who default on depositing contributions is a significant development in ensuring compliance with the EPF, EPS, and EDLI schemes. Here's a practical guide on how this change may impact employers:
🔍 Reduction in Penal Charges: Employers will now face a uniform penal charge of 1% of the arrear of contribution per month or 12% per annum across the mentioned schemes. This change simplifies the penalty structure and aims to encourage timely deposits.
🔍 Effective Date: Starting from 14/6/2024, the new provision will come into effect. Employers should be aware of this date to adjust their processes accordingly to avoid penalties.
🔍 Compliance Reminder: This reduction in penal charges does not negate the importance of timely and accurate contribution deposits. Employers must continue to meet their obligations promptly to avoid any penalties.
Ensuring Compliance
1. Regularly review contribution schedules to avoid missing deadlines.
2. Utilize digital platforms provided by EPFO for seamless and timely deposit submissions.
3. Keep abreast of any further updates or changes in EPF regulations to maintain compliance.
Impact on Employers
1. Reduced financial burden on employers for defaulting on contributions.
2. Increased emphasis on timely deposit submission to avoid penalties under the new structure.
Employers should proactively adapt to these changes to ensure smooth operations and compliance with EPF regulations.
From India, Gurugram
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54🔍 Reduction in Penal Charges: Employers will now face a uniform penal charge of 1% of the arrear of contribution per month or 12% per annum across the mentioned schemes. This change simplifies the penalty structure and aims to encourage timely deposits.
🔍 Effective Date: Starting from 14/6/2024, the new provision will come into effect. Employers should be aware of this date to adjust their processes accordingly to avoid penalties.
🔍 Compliance Reminder: This reduction in penal charges does not negate the importance of timely and accurate contribution deposits. Employers must continue to meet their obligations promptly to avoid any penalties.
Ensuring Compliance
1. Regularly review contribution schedules to avoid missing deadlines.
2. Utilize digital platforms provided by EPFO for seamless and timely deposit submissions.
3. Keep abreast of any further updates or changes in EPF regulations to maintain compliance.
Impact on Employers
1. Reduced financial burden on employers for defaulting on contributions.
2. Increased emphasis on timely deposit submission to avoid penalties under the new structure.
Employers should proactively adapt to these changes to ensure smooth operations and compliance with EPF regulations.
From India, Gurugram
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