The new EPF, EPS and EDLI Schemes 2026, explained for Indian SMEs
On 29 June 2026 the Ministry of Labour and Employment notified three new schemes, one each for provident fund, pension and employee insurance, under the Code on Social Security, 2020. They replace the 1952, 1995 and 1976 schemes most of us grew up filing.
For a small company, the main point is simple. You and your employee still contribute 12 percent each. The changes are mainly about enrolment, forms, reporting, and the cost of filing late. The details below are for the person handling the monthly filing.
What changes for you
This is mainly an administrative change, not a change to the contribution rate. If your payroll already carries provident fund, the schemes alone do not change next month's outgo. The wage ceiling does: from 17 September 2026 it is 25,000 rupees a month, up from 15,000, per the Ministry of Labour and Employment, so contributions rise for anyone who was capped at the old figure. What tightens is the record keeping around that money, and it does so in a few specific ways worth knowing before you file again.
A new hire who earns within the 25,000 rupee ceiling is a member from the day they join, and has to appear in that month's return. The old habit of waiting until probation ends is gone. Someone earning above the ceiling is treated as an excluded employee, so provident fund stays optional for them. You and the employee can sign a joint option to contribute on the fuller wage, and the employee is free to put in more than the standard rate without you having to match it.
The last shift is that the paperwork now lives online. Aadhaar, PAN, the UAN, nominations, claims and the passbook all sit in the digital system, and you produce records online, including when an inspector comes. A folder of printouts will not stand on its own any more.
The contributions, and the numbers worth quoting
Contribution holds at 12 percent from you and 12 percent from the employee, with administrative charges on top of the mandatory and any voluntary amount. Inside your share, 8.33 percent of wages up to the ceiling goes toward pension, and that rises to 9.49 percent for anyone who opted to contribute on higher wages. The minimum pension is still 1,000 rupees a month, unchanged for years and still a grievance for pensioners. Someone who leaves before qualifying for a monthly pension can take a withdrawal benefit after 36 months.
The insurance figures are different. The base cover runs from 50,000 to 1,00,000 rupees. Where the employee had a clear year of service before death, the family gets the enhanced cover, from 2,50,000 up to 7,00,000 rupees. On savings, a member can make a partial withdrawal after a year in the fund, as long as a quarter of the balance stays behind. None of this changes how a payslip with provident fund and ESI is built, or how you run monthly payroll. It changes the labels and the reporting, not the sums.
The filing calendar, and the contractor forms
This part requires the most work for a small team. When the scheme first applies to you, a consolidated return in Form V is due within fifteen days. After that, returns go up every month, again within fifteen days of the month closing, and joiners, exits, a change of ownership or a new signatory are all reported through the EPFO portal rather than on a form in a drawer. Tie this to the moment you onboard a new employee and the monthly close stops being a scramble.
Contract labour uses three additional forms.
| Form | Who files it | What it covers |
|---|---|---|
| Form X | Principal employer | Declares every contractor engaged by the establishment. |
| Form XI | Contractor | Reports name, UAN, wages and contributions for contract workers, within 10 days of month end. |
| Form XII | Principal employer | Shows the recoveries made from contract worker wages, within 20 days of month end. |
If a contractor is not registered on its own, the bill for those workers lands back on you as the principal employer. Anyone who hires labour through a vendor should read that line twice.
What a late month costs
File on time and none of this touches you. Miss a deadline and two charges start to run. A late return costs 500 rupees a day, up to a cap. Late contributions draw damages that climb with the delay.
| Length of delay | Damages a month, on the arrears |
|---|---|
| Under two months | 0.25 percent |
| Two to four months | 0.50 percent |
| Over four months | 1 percent |
Late contributions also carry interest at 12 percent a year under Section 7Q. A recurring delay can become expensive over the course of a year.
There is a way back for older gaps. The rollout came with time bound windows, an enrolment drive for staff who should have been covered earlier, and an amnesty route that waives damages and penalties where workers already got benefits at or above the statutory level. The board framed these as a way to close disputes rather than chase them. You can read its summary in the Ministry of Labour and Employment press release, and watch for fresh circulars on the Ministry's notifications page. If something has been sitting in your compliance file, this is the quarter to settle it.
Before your next return
No project plan needed. A handful of habits will keep you clear.
- Enrol every joiner within the ceiling from their joining date, not after probation.
- Get the joint option on paper before you deduct on wages above 25,000 rupees.
- Ask each contractor for their Form XI on time, and send your Form X and Form XII inside the ten and twenty day marks.
- Set the monthly return reminder for the twelfth, so the fifteenth is a buffer and not a deadline.
- If earlier months slipped, use the amnesty window while it is open.
- Keep payslips and settlements exact, since a clean full and final settlement is easy only when the monthly numbers were right.
What Offrd handles
Offrd does not file returns with EPFO. It does not submit Form V, the contractor forms, or the challan. Those filings remain with your CA or PF consultant.
Offrd calculates provident fund, pension, and insurance figures for offer letters, payslips, and settlements, including the 25,000 rupee ceiling. The records can then be exported and given to your CA or PF consultant. The filing itself remains outside Offrd.
More than 4,000 companies across 350 plus Indian cities use Offrd to produce this paperwork in minutes.
Generate an offer letter or a payslip with provident fund already worked in, keep the same figures flowing through to exit, and see the full set of HR documents it covers. Pay as you go starts at 99 rupees for 10 credits, an offer letter uses 10, and signup comes with 50 free credits and nothing to commit to each month.
Frequently asked questions
When did the EPF, EPS and EDLI Schemes 2026 take effect?
The Ministry of Labour and Employment notified the three schemes on 29 June 2026 under the Code on Social Security, 2020. They took effect from the date of publication in the Official Gazette and replace the 1952 EPF scheme, the 1995 pension scheme and the 1976 insurance scheme.
Do contribution rates change under the 2026 schemes?
The rates do not. The employer and employee each contribute 12 percent of wages, and EDLI stays an employer only charge. The wage ceiling did change: it went from 15,000 to 25,000 rupees a month on 17 September 2026, so contributions rise for anyone who was capped at the old ceiling. The 2026 schemes themselves change the filing calendar, the forms and the penalties.
What are the new EPF forms for contract labour?
The principal employer files Form X to declare every contractor engaged. The contractor reports employee name, UAN, wages and contributions in Form XI within 10 days of month end. The principal employer then files Form XII within 20 days to show recoveries from contract worker wages.
What is the penalty for late EPF filing in 2026?
A late return draws a fee of 500 rupees a day, subject to a cap. Delayed contributions draw graded damages from 0.25 to 1 percent of the arrears a month by length of delay, on top of 12 percent a year interest under Section 7Q.
Can an employee earning above 25,000 rupees still join EPF?
Yes. Such an employee is an excluded employee by default, but the employer and employee can jointly opt to contribute on the higher wage. The employee may also add voluntary contributions, with no obligation on the employer to match them.
Does Offrd file EPF returns with EPFO?
No. Offrd computes EPF, EPS and EDLI correctly on payslips, offer letters and full and final settlements, and keeps clean records you can hand to your CA or PF consultant, who files the returns. Offrd is not a filing agent and does not submit forms to EPFO.
Get the PF numbers right before they reach a return
Offrd builds EPF, EPS and EDLI into every offer letter, payslip and settlement, so your filings start from clean data. Setup takes about two minutes.