{"id":6969,"date":"2026-07-14T13:07:24","date_gmt":"2026-07-14T07:37:24","guid":{"rendered":"https:\/\/lawsikho.com\/blog\/?p=6969"},"modified":"2026-07-14T13:07:27","modified_gmt":"2026-07-14T07:37:27","slug":"epf-provident-fund-contribution-uan-withdrawal","status":"publish","type":"post","link":"https:\/\/lawsikho.com\/blog\/epf-provident-fund-contribution-uan-withdrawal\/","title":{"rendered":"EPF: Contribution, UAN &#038; Withdrawal Rules 2026"},"content":{"rendered":"<!--\n  Employees' Provident Fund (EPF) - VERSION-A\n  WP-paste-ready HTML. Paste into the WordPress block editor as Custom HTML or via the Code Editor view.\n  - Slug: epf-provident-fund-contribution-uan-withdrawal\n  - Last verified: 2026-07-14\n  - Schema (Article + FAQPage) is included at the bottom in separate wp:html blocks.\n  - VERSION-A: clean (no CTAs \/ Expert Inserts)\n-->\n\n\n\n<p>Last verified: 2026-07-14<\/p>\n\n<p>The Employees&#8217; Provident Fund (EPF) is a compulsory retirement-savings scheme for salaried workers in India, run by the Employees&#8217; Provident Fund Organisation (EPFO) under the <a href=\"https:\/\/www.indiacode.nic.in\/handle\/123456789\/2152\" target=\"_blank\" rel=\"noopener\">Employees&#8217; Provident Funds and Miscellaneous Provisions Act, 1952<\/a> and, from November 2025, under the <a href=\"https:\/\/www.indiacode.nic.in\/handle\/123456789\/16823\" target=\"_blank\" rel=\"noopener\">Code on Social Security, 2020<\/a>. It covers establishments with 20 or more employees. You and your employer each contribute 12 percent of your basic pay plus dearness allowance, the money earns interest fixed every year (8.25 percent for 2025-26), and it is tracked through a single Universal Account Number (UAN) that follows you from job to job. You can withdraw it in full at retirement, or in part for specific needs before then.<\/p>\n<p>This article sets out the EPF contribution rules, how the UAN works, the withdrawal and tax position, and what the 2026 labour codes changed for provident fund.<\/p>\n\n<hr>\n\n<p>The 1952 Act ran provident fund for over seventy years. From 21 November 2025 EPF sits inside Chapter III of the Code on Social Security, 2020, and a fresh Employees&#8217; Provident Funds Scheme, 2026 has replaced the old 1952 Scheme, carrying the core rules forward while changing how much of your contribution is mandatory.<\/p>\n<p>A word before the numbers. EPF is not one scheme but three, stacked together: the provident fund itself, a pension (EPS), and a small life-insurance cover (EDLI). Most of the confusion around &#8220;where did my PF money go&#8221; comes from not seeing that split, so it&#8217;s worth getting straight early.<\/p>\n\n<hr>\n\n<nav class=\"ls-toc\" aria-label=\"Table of contents\">\n<h2>Table of Contents<\/h2>\n<ol class=\"ls-toc-list\">\n<li><a href=\"#h2-1\">How the Employees&#8217; Provident Fund works<\/a><\/li>\n<li><a href=\"#h2-2\">EPF contribution rules<\/a><\/li>\n<li><a href=\"#h2-3\">The Universal Account Number (UAN)<\/a><\/li>\n<li><a href=\"#h2-4\">EPF withdrawal rules and forms<\/a><\/li>\n<li><a href=\"#h2-5\">Tax on EPF and withdrawals<\/a><\/li>\n<li><a href=\"#h2-6\">What the 2026 rules changed under the Code on Social Security<\/a><\/li>\n<\/ol>\n<\/nav>\n\n<hr>\n\n<h2><a id=\"h2-1\"><\/a>How the Employees&#8217; Provident Fund works<\/h2>\n<p>The Employees&#8217; Provident Fund works by taking a fixed slice of your monthly pay, matching it with an equal employer contribution, and locking both into an interest-bearing account you access mainly at retirement. The whole system is administered by the EPFO, a statutory body under the Ministry of Labour and Employment, and it applies to every factory and establishment employing 20 or more persons that the Act or the Code reaches.<\/p>\n<p>Here&#8217;s the part most employees never see on their payslip. Your PF isn&#8217;t a single pot. The law runs three linked schemes on top of the same contribution, and knowing which is which explains almost every later question about pension and withdrawal.<\/p>\n<p>The first is the provident fund proper, the Employees&#8217; Provident Funds Scheme, where the bulk of the money sits and earns interest. The second is the Employees&#8217; Pension Scheme, 1995 (EPS), which pays a monthly pension after retirement and is funded by carving a portion out of the employer&#8217;s share. The third is the Employees&#8217; Deposit Linked Insurance Scheme, 1976 (EDLI), a life-cover that pays a lump sum to your family if you die in service, at no cost to you.<\/p>\n<h3>Who is covered, and who can opt in<\/h3>\n<p>Coverage is mandatory once an establishment crosses 20 employees, and here&#8217;s a rule employers forget: once the Act applies, it keeps applying even if the headcount later falls below twenty. An employee earning basic-plus-DA of up to Rs. 15,000 a month must be enrolled from day one of employment. Above that figure, enrolment isn&#8217;t automatic, but an employee can still join with the employer&#8217;s consent (these are the &#8220;excluded employees&#8221; who choose in).<\/p>\n<p>Smaller establishments, those under twenty, can also come in voluntarily. And once you&#8217;re a member, you generally stay a member: a pay rise past Rs. 15,000 doesn&#8217;t push you out. The mistake we see most often is a new joiner on a high salary assuming PF is optional and waiving it, then regretting the lost employer contribution and pension years later.<\/p>\n<p>Is EPF worth it if you could invest the money yourself? For most salaried workers, yes. The employer&#8217;s matching 12 percent is effectively deferred salary you&#8217;d never otherwise see, the interest is tax-free within limits, and the corpus is protected from attachment by creditors under the Act. That combination is hard to beat on a like-for-like risk basis.<\/p>\n\n<h2><a id=\"h2-2\"><\/a>EPF contribution rules<\/h2>\n<p>The EPF contribution rule is simple at its core: you contribute 12 percent of your basic wages plus dearness allowance, and your employer contributes 12 percent too. What complicates it is where the employer&#8217;s 12 percent actually goes, because unlike your share, it doesn&#8217;t all land in your provident fund.<\/p>\n<p>Your own 12 percent goes entirely into the EPF account. The employer&#8217;s 12 percent splits: 8.33 percent is diverted to your pension (EPS) and only the remaining 3.67 percent joins your EPF. So the pension you&#8217;ll draw later is being funded quietly, month by month, out of the employer&#8217;s contribution, not yours.<\/p>\n<h3>The 8.33 percent that funds your pension<\/h3>\n<p>The 8.33 percent EPS diversion is capped, and this cap catches people out. The pension contribution is calculated only on wages up to Rs. 15,000, so the maximum that can go to EPS is 8.33 percent of Rs. 15,000, which is Rs. 1,250 a month, whatever your actual salary. Anything the employer contributes above that stays in the EPF account rather than the pension.<\/p>\n<p>Think of it this way. If your basic-plus-DA is Rs. 50,000 and your employer contributes 12 percent (Rs. 6,000), Rs. 1,250 goes to EPS and the balance Rs. 4,750 goes to EPF. On a Rs. 15,000 salary, the same 12 percent (Rs. 1,800) splits into Rs. 1,250 to EPS and Rs. 550 to EPF. The pension slice is frozen at Rs. 1,250 either way.<\/p>\n<p>The employer also carries two costs you don&#8217;t: 0.5 percent of wages to EDLI (the insurance), again capped at Rs. 15,000, plus administrative charges. So the employer&#8217;s true outgo is a little over 12 percent, while your deduction is exactly 12 percent of your PF wages.<\/p>\n<h3>What counts as &#8220;wages&#8221; for the 12 percent<\/h3>\n<p>The single biggest PF dispute isn&#8217;t the rate; it&#8217;s the base the rate runs on. &#8220;Basic wages&#8221; under Section 2(b) of the 1952 Act means all emoluments paid in cash, but it excludes house rent allowance, bonus, overtime and certain other allowances. Employers with allowance-heavy salary structures used to keep basic artificially small and load the rest into &#8220;special allowances&#8221;, shrinking the PF base.<\/p>\n<p>The Supreme Court shut most of that down. In <a href=\"https:\/\/indiankanoon.org\/doc\/126246109\/\" target=\"_blank\" rel=\"noopener\">Regional Provident Fund Commissioner (II), West Bengal v. Vivekananda Vidyamandir, (2019) 3 SCC 704<\/a>, the Court laid down the &#8220;universality&#8221; test: any allowance that is paid universally, ordinarily and necessarily to all employees is part of basic wages for PF, and cannot be excluded by simply labelling it &#8220;special&#8221;. Allowances genuinely linked to extra work or specific conditions can stay out; blanket allowances paid to everyone cannot.<\/p>\n<p>So does a fat &#8220;special allowance&#8221; keep your PF base low? Not anymore, if it&#8217;s paid to everyone as a matter of course. An employee who thinks their PF contribution looks light should check what wage figure the employer actually used, because that, not the 12 percent, is usually where the money is quietly lost.<\/p>\n<h3>The interest rate and how it&#8217;s credited<\/h3>\n<p>EPF interest is declared once a year by the government on the EPFO&#8217;s recommendation, and for the financial year 2025-26 it is 8.25 percent, the third year running at that figure. Interest is calculated monthly on your running balance but credited to the account once a year, at year-end.<\/p>\n<p>One point worth flagging: interest keeps accruing on your balance even after you leave a job, but an account with no fresh contribution becomes &#8220;inoperative&#8221; after 36 months, and although recent rules restored interest on many such accounts, the cleaner route is to transfer or withdraw rather than let it sit idle.<\/p>\n\n<h2><a id=\"h2-3\"><\/a>The Universal Account Number (UAN)<\/h2>\n<p>The Universal Account Number (UAN) is a 12-digit number the EPFO allots to every member, and it is the single thread that ties all your PF accounts together across every job you hold. Before the UAN, changing employers meant a new PF account each time and a paper chase to move the money; the UAN replaced that with one lifelong identifier.<\/p>\n<p>Each job still generates its own member ID (the account with that specific employer), but all of them sit under your one UAN. That&#8217;s what makes your PF portable: you carry the number, not the account, from employer to employer.<\/p>\n<h3>Activating and linking your UAN<\/h3>\n<p>Your first employer generates the UAN and prints it on your salary slip or shares it through the EPFO portal, but it sits dormant until you activate it. Activation is done once, on the EPFO member portal, using your UAN, a registered mobile number and an OTP, after which you can log in to see your passbook, balance and claim status.<\/p>\n<p>The step people skip is KYC. You need to link your Aadhaar, PAN and bank account to the UAN and have the employer approve them, because an unverified UAN blocks online withdrawals and transfers. In practice, though, most claim rejections trace back to a KYC mismatch, a name that doesn&#8217;t match Aadhaar, or an unlinked bank account, so it pays to get this clean before you need the money.<\/p>\n<h3>Why the UAN matters when you switch jobs<\/h3>\n<p>When you change jobs, the right move is to transfer the old PF to the new employer&#8217;s account under the same UAN, not to withdraw it. Transfer keeps the corpus growing and, crucially, preserves your continuous service record, which decides both the five-year tax rule and the ten-year pension eligibility.<\/p>\n<p>Should you withdraw PF every time you switch? Almost never. Each withdrawal resets your service clock and shrinks a corpus that compounds tax-free. The better approach, in our view, is to treat the UAN as a lifelong account and let it run: one number, one growing balance, from your first job to retirement. We cover the way service continuity plays out across the wider framework in our guide to the <a href=\"https:\/\/lawsikho.com\/blog\/labour-laws-in-india\/\">labour laws in India<\/a>.<\/p>\n\n<h2><a id=\"h2-4\"><\/a>EPF withdrawal rules and forms<\/h2>\n<p>EPF withdrawal comes in two forms: a full and final settlement when you leave the workforce, and partial &#8220;advances&#8221; you can draw for specific needs while still employed. Which one applies, and which form you file, depends entirely on why you&#8217;re withdrawing.<\/p>\n<p>The default position is that PF is a retirement corpus, not a savings account. The rules are built to keep the money invested and release it only at genuine exit points or for defined needs, which is why casual full withdrawals between jobs are discouraged (and now partly restricted).<\/p>\n<h3>Full and final settlement<\/h3>\n<p>You can claim the full balance in two situations: on retirement at or after the age of 58, or after two months of continuous unemployment following your exit. That two-month gap is deliberate; it stops people from withdrawing the moment they switch jobs instead of transferring. The date of exit recorded against your account must be at least two months before you file the claim.<\/p>\n<p>Full settlement uses Form 19 for the EPF portion and Form 10C for the EPS (pension) portion if you have less than ten years of service. If you&#8217;ve completed ten years of pensionable service, the EPS money isn&#8217;t withdrawn as a lump sum; it converts into a monthly pension from age 58, and the higher-pension option opened up by the Supreme Court in <a href=\"https:\/\/indiankanoon.org\/doc\/14993351\/\" target=\"_blank\" rel=\"noopener\">EPFO v. Sunil Kumar B., (2022) SCC OnLine SC 1521<\/a> allowed eligible members to have their pension computed on actual, uncapped wages rather than the Rs. 15,000 ceiling.<\/p>\n<h3>Partial withdrawals (advances)<\/h3>\n<p>The Act allows advances against your own balance for defined purposes, without leaving the job. The classic grounds are illness of self or family, buying or building a house, repaying a home loan, a wedding in the family, higher education, and the period just before retirement. Each has its own eligibility (a minimum number of years of membership) and its own cap on how much you can take.<\/p>\n<p>What changed in 2026 is the tidying-up. The Employees&#8217; Provident Funds Scheme, 2026 has collapsed the old thirteen-odd advance categories into three broad heads: essential needs (illness, education, marriage), housing needs (purchase, construction, loan repayment), and special circumstances (other emergencies). The reform also lets a member withdraw up to the full eligible balance in some cases, but requires retaining a minimum of 25 percent of total contributions in the account, so the corpus is never fully emptied while you&#8217;re still working.<\/p>\n<h3>The forms and the online process<\/h3>\n<p>For a partial advance you file Form 31, and the whole process is now online through the EPFO member portal and the UMANG app, provided your UAN is Aadhaar-verified and your bank account is linked. A useful 2026 update: if your bank account is already NPCI-verified against your UAN, you no longer need to upload a scanned cheque or passbook image.<\/p>\n<p>Here&#8217;s the practical reality. Online claims for a fully KYC-verified member are targeted for settlement in as little as three working days, but an incomplete or mismatched KYC is what stalls most claims, not the EPFO&#8217;s processing time. The iPleaders explainer on <a href=\"https:\/\/blog.ipleaders.in\/employee-provident-fund-withdrawal\/\" target=\"_blank\" rel=\"noopener\">EPF withdrawal rules and taxes<\/a> walks through the form-by-form mechanics in more detail.<\/p>\n\n<h2><a id=\"h2-5\"><\/a>Tax on EPF and withdrawals<\/h2>\n<p>The tax treatment of EPF turns on one line: five years of continuous service. Withdraw after completing five years and the entire amount, contributions and interest, is exempt from income tax under Section 10(12) of the Income Tax Act, 1961. Withdraw before five years and the picture changes sharply.<\/p>\n<p>This five-year test is where the UAN and transfers pay off. The five years don&#8217;t have to be with one employer; service across multiple jobs counts as continuous as long as you transferred the PF each time instead of withdrawing it. Break that chain with a withdrawal and you restart the clock.<\/p>\n<h3>Withdrawal before five years<\/h3>\n<p>If you withdraw before completing five years of service and the amount exceeds Rs. 50,000, the EPFO deducts TDS under Section 192A of the Income Tax Act, 1961. The rate is 10 percent if your PAN is linked; without a valid PAN, it&#8217;s 20 percent (reduced from the maximum marginal rate in the 2023 Budget), so linking PAN to the UAN is not optional if you want to avoid a heavier cut.<\/p>\n<p>Beyond the TDS, an early withdrawal can unwind past tax benefits: the employer&#8217;s contribution and the interest become taxable, and any Section 80C deduction you claimed on your own contributions can be reversed. The narrow relief is that if you were forced out through no fault of your own (ill-health, the employer&#8217;s business closing), the withdrawal is treated more leniently.<\/p>\n<h3>The Rs. 2.5 lakh interest rule<\/h3>\n<p>There&#8217;s a second tax layer that affects high earners even without any withdrawal. Since the 2021 Budget, interest earned on an employee&#8217;s own EPF contributions above Rs. 2.5 lakh in a financial year is taxable, rather than exempt. The threshold rises to Rs. 5 lakh where the employer makes no matching contribution.<\/p>\n<p>So is EPF still a tax-free haven? For the vast majority of salaried workers, yes: most never contribute enough to cross Rs. 2.5 lakh a year, and a withdrawal after five years lands entirely tax-free. The rule bites only at the top end, and even there only on the interest on the excess, not the whole balance.<\/p>\n\n<h2><a id=\"h2-6\"><\/a>What the 2026 rules changed under the Code on Social Security<\/h2>\n<p>The 2026 change is structural: EPF now sits inside Chapter III of the Code on Social Security, 2020, which replaced the standalone 1952 Act when the four labour codes came into force across India on 21 November 2025. For most members, the day-to-day mechanics feel familiar, because the Code carries the old scheme forward almost intact.<\/p>\n<p>The 12 percent rate survives. The 8.33 percent pension diversion survives. The UAN, the interest mechanism and the withdrawal grounds survive. If you learned PF under the 1952 Act, you already know most of the Code. This is a rehousing, not a rewrite, and it&#8217;s part of the wider shift from twenty-nine separate labour statutes to four consolidated codes, which we map in our guide to the <a href=\"https:\/\/lawsikho.com\/blog\/new-labour-code-compliance-checklist-india-2026\/\">new labour code compliance checklist<\/a>.<\/p>\n<h3>The Rs. 1,800 mandatory floor and voluntary contribution<\/h3>\n<p>Here&#8217;s the genuine change, and it&#8217;s about how much of your contribution is compulsory. The government has notified Rs. 15,000 a month as the statutory wage ceiling for EPF under the Code (a notification of 29 May 2026, under Section 2(89)), and the new Employees&#8217; Provident Funds Scheme, 2026 pegs the mandatory contribution to that ceiling. Twelve percent of Rs. 15,000 is Rs. 1,800, so Rs. 1,800 a month becomes the compulsory contribution, and anything on wages above Rs. 15,000 is now treated as voluntary.<\/p>\n<p>In plain terms, even an employee earning Rs. 1 lakh a month is only required to contribute Rs. 1,800, though they may opt to contribute more on the excess, and the employer is not obliged to match that voluntary top-up. For high earners who want the full tax-advantaged corpus, the voluntary route (long known as VPF) stays open; the difference is that the excess is now an active choice rather than an automatic deduction.<\/p>\n<h3>Wider coverage and the fixed-term angle<\/h3>\n<p>The Code also widens who&#8217;s inside the net. EPF under the Code reaches establishments with 20 or more employees across the board, rather than only the notified &#8220;scheduled&#8221; industries the 1952 Act listed, and it explicitly pulls in workers engaged through contractors. For a workforce that increasingly runs on contract and fixed-term staff, that closes gaps the old scheme left open, and it sits alongside the pro-rata benefits fixed-term staff now get, which we cover in <a href=\"https:\/\/lawsikho.com\/blog\/fixed-term-employment-labour-codes\/\">fixed-term employment under the labour codes<\/a>.<\/p>\n<figure class=\"wp-block-table\"><table>\n<thead><tr><th>Provision<\/th><th>EPF &amp; MP Act, 1952<\/th><th>Code on Social Security, 2020 (from 21 Nov 2025)<\/th><\/tr><\/thead>\n<tbody>\n<tr><td>Governing law<\/td><td>Standalone Act + EPF Scheme, 1952<\/td><td>Chapter III + EPF Scheme, 2026<\/td><\/tr>\n<tr><td>Coverage<\/td><td>Notified scheduled industries, 20+ employees<\/td><td>Establishments with 20+ employees, broadly<\/td><\/tr>\n<tr><td>Employee contribution<\/td><td>12% of basic + DA<\/td><td>12%, but mandatory only up to Rs. 15,000 (Rs. 1,800)<\/td><\/tr>\n<tr><td>Above-ceiling contribution<\/td><td>Often continued on actual wages<\/td><td>Voluntary<\/td><\/tr>\n<tr><td>Wage ceiling<\/td><td>Rs. 15,000<\/td><td>Rs. 15,000 (notified 29 May 2026)<\/td><\/tr>\n<tr><td>Advance categories<\/td><td>~13 purpose-specific grounds<\/td><td>3 heads, retain minimum 25%<\/td><\/tr>\n<\/tbody>\n<\/table><\/figure>\n<p>Read the table and the pattern is clear. The rate and the pension split barely moved. What moved is how much you must contribute (a Rs. 1,800 floor, the rest optional), who&#8217;s covered (wider, including contract labour), and how withdrawals are grouped. The mechanics that make PF the reliable corpus it is stayed exactly where they were. This is the same consolidation that reshaped gratuity, which we break down in our guide to <a href=\"https:\/\/lawsikho.com\/blog\/gratuity-in-india\/\">gratuity in India<\/a>.<\/p>\n\n<h2><a id=\"faq\"><\/a>Frequently asked questions<\/h2>\n<h3>1. What is the Employees&#8217; Provident Fund (EPF)?<\/h3>\n<p>EPF is a compulsory retirement-savings scheme for salaried employees, run by the EPFO under the Employees&#8217; Provident Funds and Miscellaneous Provisions Act, 1952 (now within the Code on Social Security, 2020). You and your employer each contribute 12 percent of basic-plus-DA, the balance earns annual interest, and you withdraw it at retirement or, in part, for defined needs.<\/p>\n<h3>2. How much is the EPF contribution?<\/h3>\n<p>You contribute 12 percent of your basic wages plus dearness allowance, and your employer contributes 12 percent. Your full 12 percent goes to EPF; the employer&#8217;s splits into 8.33 percent to the pension (EPS) and 3.67 percent to EPF.<\/p>\n<h3>3. What is the Rs. 1,250 in my PF?<\/h3>\n<p>Rs. 1,250 is the maximum monthly diversion to the Employees&#8217; Pension Scheme, being 8.33 percent of the Rs. 15,000 wage ceiling. The pension contribution is capped at this figure regardless of your actual salary.<\/p>\n<h3>4. What is the EPF interest rate for 2025-26?<\/h3>\n<p>8.25 percent per annum, declared by the government on the EPFO&#8217;s recommendation. It is the third consecutive year at 8.25 percent. Interest is calculated monthly on the running balance and credited once a year.<\/p>\n<h3>5. What is a UAN?<\/h3>\n<p>The Universal Account Number is a 12-digit number the EPFO assigns to every member. It links all your PF accounts across different jobs under one identifier, making the fund portable when you switch employers.<\/p>\n<h3>6. How do I activate my UAN?<\/h3>\n<p>Activate it once on the EPFO member portal using your UAN, a registered mobile number and an OTP. Then link your Aadhaar, PAN and bank account and have the employer approve the KYC, because an unverified UAN blocks online claims.<\/p>\n<h3>7. When can I withdraw my full EPF?<\/h3>\n<p>You can withdraw the full balance on retirement at or after age 58, or after two months of continuous unemployment following your exit. The date of exit must be at least two months before you file the claim.<\/p>\n<h3>8. Can I withdraw PF while still employed?<\/h3>\n<p>Yes, as a partial advance for defined needs such as illness, housing, home-loan repayment, marriage, or higher education. From 2026 these grounds are grouped into three heads (essential needs, housing, special circumstances), and you generally must retain at least 25 percent of total contributions.<\/p>\n<h3>9. Which forms are used for EPF withdrawal?<\/h3>\n<p>Form 19 for final EPF settlement, Form 10C for the pension (EPS) portion where service is under ten years, and Form 31 for partial advances. Claims are filed online through the EPFO portal or the UMANG app.<\/p>\n<h3>10. Is EPF withdrawal taxable?<\/h3>\n<p>Withdrawal after five years of continuous service is fully tax-free under Section 10(12) of the Income Tax Act, 1961. Withdrawal before five years, where the amount exceeds Rs. 50,000, attracts TDS under Section 192A at 10 percent with PAN, 20 percent without.<\/p>\n<h3>11. Do the five years have to be with one employer?<\/h3>\n<p>No. Service across multiple jobs counts as continuous for the five-year rule, provided you transferred the PF under your UAN each time instead of withdrawing it. A withdrawal breaks the chain and restarts the clock.<\/p>\n<h3>12. Is EPF interest taxable?<\/h3>\n<p>Interest on your own contributions up to Rs. 2.5 lakh in a financial year is tax-free; interest on contributions above Rs. 2.5 lakh is taxable. The threshold is Rs. 5 lakh where the employer makes no matching contribution.<\/p>\n<h3>13. Did the 2026 rules change EPF?<\/h3>\n<p>EPF moved into Chapter III of the Code on Social Security, 2020 from 21 November 2025, and the EPF Scheme, 2026 replaced the 1952 Scheme. The core rate and pension split are unchanged; the real changes are a Rs. 1,800 mandatory contribution floor (the rest voluntary), wider coverage including contract labour, and three consolidated withdrawal heads.<\/p>\n<h3>14. Is PF now capped at Rs. 1,800 a month?<\/h3>\n<p>Rs. 1,800 (12 percent of the Rs. 15,000 ceiling) is the mandatory contribution. Contributions on wages above Rs. 15,000 are now voluntary rather than automatic, so you can still contribute more if you choose, but you are not compelled to.<\/p>\n\n<h2><a id=\"references\"><\/a>References<\/h2>\n<h3>Case Law<\/h3>\n<ol>\n<li><a href=\"https:\/\/indiankanoon.org\/doc\/126246109\/\" target=\"_blank\" rel=\"noopener\">Regional Provident Fund Commissioner (II), West Bengal v. Vivekananda Vidyamandir, (2019) 3 SCC 704<\/a>: allowances universally, ordinarily and necessarily paid to all employees form part of &#8220;basic wages&#8221; for provident fund contribution; a &#8220;special allowance&#8221; label alone cannot exclude them (AIR 2019 SC 1240).<\/li>\n<li><a href=\"https:\/\/indiankanoon.org\/doc\/14993351\/\" target=\"_blank\" rel=\"noopener\">EPFO v. Sunil Kumar B., (2022) SCC OnLine SC 1521<\/a>: upheld the validity of the Employees&#8217; Pension (Amendment) Scheme, 2014 and allowed eligible members a fresh option to draw pension on actual (uncapped) wages, striking down the earlier cut-off date as contrary to the beneficial scheme.<\/li>\n<\/ol>\n<h3>Statutes<\/h3>\n<ol>\n<li><a href=\"https:\/\/www.indiacode.nic.in\/handle\/123456789\/2152\" target=\"_blank\" rel=\"noopener\">Employees&#8217; Provident Funds and Miscellaneous Provisions Act, 1952<\/a>. Provisions cited: Section 2(b) (basic wages); read with the Employees&#8217; Provident Funds Scheme, 1952, the Employees&#8217; Pension Scheme, 1995, and the Employees&#8217; Deposit Linked Insurance Scheme, 1976.<\/li>\n<li><a href=\"https:\/\/www.indiacode.nic.in\/handle\/123456789\/16823\" target=\"_blank\" rel=\"noopener\">Code on Social Security, 2020<\/a>. Chapter III (provident fund, pension and insurance), in force from 21 November 2025; Section 2(89) (wage ceiling, Rs. 15,000 notified 29 May 2026); read with the Employees&#8217; Provident Funds Scheme, 2026.<\/li>\n<li>Income Tax Act, 1961: Section 10(12) (exemption on withdrawal after five years) and Section 192A (TDS on premature withdrawal above Rs. 50,000).<\/li>\n<\/ol>\n\n<p><em>This article is for informational purposes only and does not constitute legal advice. For specific legal guidance, consult a qualified legal professional.<\/em><\/p>\n\n\n\n<script type=\"application\/ld+json\">\n{\"@context\":\"https:\/\/schema.org\",\"@type\":\"Article\",\"headline\":\"EPF \/ Provident Fund: Contribution Rules, UAN & Withdrawal\",\"description\":\"You and your employer each pay 12% of basic+DA into EPF, with 8.33% routed to pension. It is tracked via your UAN, earns 8.25% for 2025-26, and is tax-free on withdrawal after 5 years.\",\"author\":{\"@type\":\"Organization\",\"name\":\"LawSikho\",\"url\":\"https:\/\/lawsikho.com\"},\"publisher\":{\"@type\":\"Organization\",\"name\":\"LawSikho\",\"logo\":{\"@type\":\"ImageObject\",\"url\":\"https:\/\/lawsikho.com\/logo.png\"}},\"datePublished\":\"2026-07-14\",\"dateModified\":\"2026-07-14\",\"mainEntityOfPage\":{\"@type\":\"WebPage\",\"@id\":\"https:\/\/lawsikho.com\/blog\/epf-provident-fund-contribution-uan-withdrawal\/\"},\"image\":\"https:\/\/lawsikho.com\/blog\/images\/epf-provident-fund-contribution-uan-withdrawal.png\",\"inLanguage\":\"en-IN\",\"articleSection\":\"Labour Law\",\"keywords\":\"Employees Provident Fund, EPF, EPF contribution rules, UAN, Universal Account Number, EPF withdrawal, EPF interest rate 2025-26, EPF tax, Employees Pension Scheme, Code on Social Security 2020, EPF Scheme 2026\"}\n<\/script>\n\n\n\n<script type=\"application\/ld+json\">\n{\"@context\":\"https:\/\/schema.org\",\"@type\":\"FAQPage\",\"mainEntity\":[{\"@type\":\"Question\",\"name\":\"What is the Employees' Provident Fund (EPF)?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"EPF is a compulsory retirement-savings scheme for salaried employees, run by the EPFO under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (now within the Code on Social Security, 2020). 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