When planning for a secure financial future, salaried individuals in India often rely on one of the most trusted retirement schemes — the Employees’ Provident Fund (EPF). Managed by the Employees’ Provident Fund Organization (EPFO), EPF is a government-backed savings scheme aimed at helping employees build a retirement corpus through regular monthly contributions during their working life.

In this comprehensive guide, we’ll break down what EPF is, how it works, its features, benefits, rules, and how you can manage your EPF account efficiently.

What is EPF?

The Employees' Provident Fund (EPF) is a retirement savings scheme under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. It is regulated by the EPFO, which is one of the world’s largest social security organizations.

Under this scheme, both the employee and the employer contribute a portion of the employee’s salary (usually 12% of basic salary + DA) towards the EPF account every month. The accumulated corpus earns interest and can be withdrawn at retirement or during certain approved circumstances like medical emergencies, home purchase, or unemployment.

Objectives of EPF

Encourage systematic savings for retirement.
Provide financial security and stability to employees.
Offer tax benefits on contributions and interest earned.
Enable partial withdrawals during emergencies.

Key Features of EPF

1. Mandatory Contribution

Both employee and employer contribute 12% of the employee’s basic salary + dearness allowance (DA) to EPF.
Out of the employer’s 12%, 8.33% goes towards EPS (Employees’ Pension Scheme) and the rest into the EPF account.

2. Interest Rate

The interest rate on EPF is declared annually by EPFO. As of FY 2024-25, the EPF interest rate is 8.25%.
Interest is tax-free and compounded annually.

3. UAN – Universal Account Number

Every EPF member is assigned a UAN, a unique 12-digit number that remains the same throughout your career.
UAN helps in tracking multiple EPF accounts across different jobs.

4. Tax Benefits

EPF enjoys EEE (Exempt-Exempt-Exempt) status:

Contribution is eligible for tax deduction under Section 80C.
Interest earned is tax-free.
Maturity proceeds are exempt from tax if certain conditions are met.

5. Withdrawal Rules

Full EPF balance can be withdrawn:

Upon retirement
If unemployed for 2 months or more

Partial withdrawals are allowed for:

Marriage
Home purchase or construction
Medical emergencies
Education
Loan repayment

Eligibility for EPF

Mandatory for salaried employees earning a basic wage of up to ₹15,000 per month.
Organizations with 20 or more employees must register with EPFO.
Employees earning more than ₹15,000 can opt-in voluntarily with employer consent.

EPF Contribution Breakdown

Let’s take an example to understand how EPF contributions work:

Suppose your basic salary + DA = ₹20,000/month

Employee’s contribution (12%) = ₹2,400
Employer’s contribution (12%):

8.33% to EPS = ₹1,666
3.67% to EPF = ₹734

So, each month, a total of ₹5,534 (₹2,400 from you + ₹3,134 from your employer) is credited towards your EPF and pension savings.

Benefits of EPF

1. Safe and Guaranteed Returns

EPF is managed by the government and offers stable returns with low risk.

2. Long-term Wealth Creation

Regular contributions and compound interest help build a significant retirement corpus over the years.

3. Tax Benefits

Contributions up to ₹1.5 lakh/year are eligible for deduction under Section 80C.
No tax on interest and final withdrawal, subject to conditions.

4. Financial Support During Emergencies

Allows partial withdrawals during crucial times without breaking the account.

5. Pension Benefits

Contribution to EPS ensures monthly pension post-retirement if you have contributed for at least 10 years.

How to Check EPF Balance

You can check your EPF balance in several ways:

1. UMANG App

Download the UMANG app and log in using your UAN and OTP.

2. EPFO Portal

Visit www.epfindia.gov.in
Go to 'Our Services' → 'For Employees' → 'Member Passbook'

3. SMS or Missed Call

SMS: Send “EPFOHO UAN ENG” to 7738299899
Missed Call: Dial 9966044425 from your registered number

EPF Withdrawal Process

You can withdraw EPF online using the UAN Member Portal:

Steps:

Visit https://unifiedportal-mem.epfindia.gov.in
Log in with your UAN and password
Go to 'Online Services' → 'Claim (Form-31, 19, 10C & 10D)'
Fill in the details and submit the claim

Note: Your KYC must be updated, and your bank account should be linked with your UAN for successful claims.

Things to Keep in Mind

If EPF is withdrawn before 5 years of continuous service, tax will be deducted on the accumulated amount.
It’s important to link Aadhaar, PAN, and bank details with your UAN for seamless service.
You can transfer EPF balance from an old employer to a new one online.

EPF vs PPF – A Quick Comparison

Feature	EPF	PPF
Contribution Limit	12% of basic + DA	₹500 – ₹1.5 lakh per year
Interest Rate	8.25% (FY 2024-25)	~7.1% (varies quarterly)
Lock-in Period	Until retirement/job change	15 years
Tax Benefits	EEE	EEE
Who Can Invest	Salaried employees only	Any Indian resident

Conclusion

The Employees’ Provident Fund (EPF) is more than just a savings scheme — it’s a foundation for a financially secure future. With its mandatory savings, guaranteed returns, tax advantages, and emergency withdrawal options, EPF plays a crucial role in shaping the retirement landscape for millions of Indian workers.

As an employee, it’s important to understand and monitor your EPF contributions regularly. With digitization and the introduction of UAN, managing your EPF account has become easier than ever.

If you’re salaried and contributing to EPF, congratulations — you’re already investing in your future.