EPS-95 Pension Scheme 2023 Update: The demand to remove the ceiling of the Employee Pension Scheme has once again intensified. The matter is still pending in the Supreme Court. But, the union says that the Ministry of Labor should take a decision on this. Settlement can also be done outside the court. In the current structure, there is a limit of Rs 15,000 for pension under the EPS Pension Fund scheme. Due to this ceiling, pensioners have been getting very less pension for many years. According to sources in the Ministry of Labor, the Ministry of Labor has received a note in this regard. There is also a warning in this.
EPS-95 Pension Scheme 2023 Update
Employee EPS-95 Pension Scheme 2023 Update
When an employee becomes a member of Employee Pension Scheme, he also becomes a member of EPS. 12% of the basic salary of the employee goes to the PF contribution. Apart from the employee, the same amount also goes into the account of the employer. But, a part of the employer’s contribution is deposited in the EPS Pension Fund. Basic salary contributes 8.33% to EPS. However, the maximum limit of pensionable salary is 15 thousand rupees. In such a situation, only a maximum of Rs 1250 can be deposited in the pension fund every month.
Understand by example of Employee Pension Scheme
According to the existing rules of the Employee Pension Scheme, if the basic salary of an employee is Rs 15,000 or more, then Rs 1,250 will be deposited in the pension fund. If the basic salary is Rs 10,000, then the contribution will be Rs 833 only. The calculation of EPS Pension (Pension Fund) on the retirement of the employee is also considered as the maximum salary of Rs 15,000 only. In such a situation, after retirement, the employee can get only Rs 7,500 as pension under the EPS rule.
What will happen if the limit of 15,000 in Employee Pension Scheme is removed?
According to EPFO’s retired enforcement office Bhanu Pratap Sharma, if the limit of Rs 15,000 is removed from the EPS pension (Pension Fund), then more than Rs 7,500 pension can be received. But, for this, the employer’s contribution to the Employee Pension Scheme will also have to be increased.
How is EPS pension calculated: EPS-95 Pension Scheme 2023 Update
- Formula for EPS calculation = Monthly Pension = (EPS Pension Fund Eligible Salary x Number of years of contribution to EPS account)/70.
- If someone’s monthly salary (average salary of last 5 years) is Rs 15,000 and the duration of the job is 30 years, then he will get Employee Pension Scheme pension of only Rs 6,828 every month.
Now if the limit is removed then how much EPS pension (Pension Fund) will be received
If the limit of 15 thousand is removed and your basic salary becomes 20 thousand, then according to the formula you will get this much pension. (20,000 X 30)/70 = Rs 8,571
Existing Conditions for Employee Pension Scheme
- Must be EPF member.
- It is necessary to stay in regular job for at least 10 years.
- Pension is available at the age of 58 years. Option to take EPS Pension (Pension Fund) after 50 years and even before the age of 58 years.
- Reduced pension will be given on taking the first pension. Form 10D has to be filled for this.
- On the death of the employee, the family gets pension.
- If the service history is less than 10 years, then they will get the option to withdraw the pension amount of Employee Pension Scheme at the age of 58 years.
EPFO New Update 2023: Check how much money has been deposited in EPFO account so far