EPF wage ceiling is ₹25,000 a month from 17 September 2026, up from ₹15,000, per the Ministry of Labour and Employment. Figures on this page use the new ceiling. For the rules on employees already on your rolls, check the EPFO circulars page. What it means for employers
Use the calculator to see your monthly EPF contribution, the employer share and a projected PF balance at retirement. It uses the ₹25,000 statutory wage ceiling.
Enter your basic salary and select Calculate to see the monthly EPF breakdown.
The projection uses the current EPF interest rate of 8.25 percent a year. Interest accrues monthly and is credited at year end under EPFO rules.
The projection assumes the salary stays the same, with no increments, and that contributions continue as shown. Your actual balance may differ. EPS is not included because it is held in a separate pension fund.
Both employee and employer contribute 12% of basic salary each month, subject to the statutory wage ceiling. That ceiling moved from ₹15,000 to ₹25,000 per month, approved by the Union Cabinet on 16 September 2026, and the Ministry of Labour and Employment has said it applies from 17 September 2026. Where basic plus DA exceeds the ceiling, the mandatory contribution for both sides is capped at the amount payable on the ceiling. At ₹25,000 that is ₹3,000 per month each. Contributions on actual basic above the ceiling are voluntary and need a joint request from employer and employee.
The employer's 12% is not deposited whole into the EPF account. It is split between two schemes: 8.33% of eligible wages goes to the Employee Pension Scheme (EPS), and the remainder goes to the EPF account. The employee's full contribution is credited entirely to EPF. The EPS share follows the same ceiling, so at ₹25,000 it works out to ₹2,083 per month against ₹1,250 under the old ceiling.
EPFO coverage is mandatory for establishments with 20 or more employees. Eligible employees earning basic plus DA up to ₹25,000 must be enrolled; those earning more may also be enrolled voluntarily. The ceiling was ₹15,000 until the Cabinet raised it on 16 September 2026.
Employees can contribute more than the mandatory 12% through Voluntary Provident Fund. The additional amount earns the same 8.25% rate and qualifies under Section 80C, up to the overall ₹1.5 lakh limit.
EPF is distinct from gratuity. Gratuity accrues separately after five continuous years of service (or one year for fixed-term workers under the new Labour Codes). Both are often managed together by payroll software.
Employee contributions qualify under Section 80C. Interest earned on contributions up to ₹2.5 lakh per year (₹5 lakh for government employees) is tax-free. Maturity amount after five years of service is also exempt.
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