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POSTED BY ON January 12, 2011 11:51 am ONE COMMENT
After going through couple of articles about EPF, i’ve got some questions related to it.
1. I heard that EPF is only available when your basic salary is below 6500? What does it mean? I got this question because I’ve seen packages where basic salary is around 30k and PF is contributed at 12% from employee as well as employer.
2. If a person basic salary is 30000 then 12% of it by employee 3600 and plus employer contribution is 3600. Does this mean this entire amount will be deposited to our PF account?
3. I’ve also seen some articles stating about calculations on how much will go to pension scheme etc. If it really going to pension scheme, then in case job switch what happens to this money.
I might be wrong in my questions as well. Can somebody explain me all these calculations and how much goes to which account, and if I withdraw this amount while I quit the job, how much of it I’ll get?
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Jayapraksh,
1. This is what the EPFO says
If the employee’s emoluments exceed Rs. 6,500/- per month, he has the option to join the Scheme(s) with the consent of employer.
So EPF is for all and for below Rs.6500 its mandatory for all.
2.Yes, in EPF entire amount is deposited i.e. Rs.7200.This you can confirm from your EPF annual statement.
3.In case of Job switch, you have an option of either taking the withdrawal now and pay the tax or take the pension after age 58 in form of annuity.
Jitendra