Employee Pension Scheme Good News : Great news for employees, pension will increase by Rs 8571, know how Employee Pension Scheme (Employee Pension Scheme) Now the amount of pension to employees under EPS can increase! Hearing is going on in the Supreme Court regarding this. It is expected that the limit on the amount already fixed on pension may be removed.
Employee Pension Scheme Good News
There is a constant demand to remove the capping on the Employees’ Pension Scheme (EPS). Now the Supreme Court is also hearing this matter. In the existing structure, a maximum limit of Rs 15000 per month has been fixed for pension under the EPS scheme. When an employee becomes a member of Employees’ Provident Fund (EPF), he also becomes a member of EPS.
The contribution of 12% of the basic salary of the employee goes to PF. Apart from the employee, this part also goes to the account of the employer. But, a part of the employer’s contribution is deposited in the EPS i.e. Employee Pension Scheme. The contribution of basic pay in EPS is 8.33%. However, the maximum limit of pensionable salary is Rs 15,000. In such a situation, only a maximum of Rs 1250 can be deposited in the Pension Fund every month.
According to the existing rules, if the basic salary of an employee is Rs 15,000 or more, then Rs 1250 will be deposited in the pension fund. If the basic salary is Rs 10,000 then the contribution will be only Rs 833. The calculation of pension on the retirement of the employee is also considered as the maximum salary of 15 thousand rupees only. In such a situation, after retirement, employees can get only Rs 7,500 as pension under the EPS rule.
According to Bhanu Pratap Sharma, retired Enforcement Office of EPFO, if the limit of Rs 15,000 from pension is abolished, then more than Rs 7,500 can be received. But, for this, the employer’s contribution in the EPS (Employee Pension Scheme) will also have to be increased.
Employee Pension Scheme Good News: Know how pension is calculated?
- Formula for EPS (Employee Pension Scheme) calculation = Monthly Pension = (Pensionable Salary x
- No. of contribution to EPS account)/70.
- If one’s monthly salary (average of last 5 years salary) is Rs 15,000 and the tenure of the job is 30 years, then he will get pension of only Rs 6,828 per month.
- If the limit is removed, what will be the pension?
- If the limit of 15 thousand is removed and your basic salary becomes 20 thousand, then according to the formula, you will get the same pension as you would get. (20,000 x 30)/70 = Rs 8,571
Existing Conditions for Pension (EPS)
- Must be a member of EPF (Employee Pension Scheme).
- Must be in job for at least 10 regular years.
- Pension is available on attaining the age of 58 years.
- Option to take pension after 50 years and even before the age of 58 years.
- On taking the first pension, you will get the reduced pension.
- For this, Form 10D has to be filled.
- 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 at the age of 58 years.
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