At present, the pension of most employees is calculated on the limit of Rs 15,000 of EPS. This happens under the Employees Pension Scheme (EPS), 1995. Subscribers who have applied for higher pension will be scrutinized by field officers of EPFO. The applications submitted by the Employers and Employees will be approved after being found correct
Employees’ Provident Fund organization ( EPFO ) has introduced a method of calculating higher pension on actual salary. This will be applicable to those subscribers of EPFO who have applied for higher pension on actual salary. At present, the pension of most employees is calculated on the limit of Rs 15,000 of EPS . This happens under the Employees Pension Scheme (EPS), 1995. Subscribers who have applied for higher pension will be scrutinized by field officers of EPFO. The applications submitted by the Employers and Employees will be approved after they are found correct.
This is how pension will be calculated
For those who have retired before September 1, 2014, their pension will be calculated on the basis of average monthly salary of 12 months prior to retirement. For employees who retire after this date, their pension will be calculated on the basis of average monthly salary during the 60 months preceding the retirement. Now there is a formula for its calculation. Pension = Pensionable Salary (Average of last 60 months salary) X Number of years of contribution / 70.
You can apply till June 26
The Supreme Court, in its November 2022 order, had ordered EPFO to give employees a chance to apply for higher pension. The last date to apply for this is 26 June. Earlier it was May 3. It was extended to 26 June. Employee has to apply for this. The employer will approve this application. After that the field officers of EPFO will investigate it. They will also check the data and documents uploaded on the EPFO website. They will have to complete this investigation within 20 days of receiving the application.
Who can apply
Employees who were members of EPFO and EPS before September 1, 2014 and are still in service but missed the opportunity to apply for enhanced pension can apply now. Employees who had retired before this date and applied for higher pension will have to validate their information.
Difference in calculation method
If you want to get pension on your actual salary instead of the pre-fixed limit of Rs 15,000, then you have to apply for it through the member portal of EPFO. At present, the limit of Rs 15,000 of salary is used for the calculation of pension. Out of your employer’s contribution, Rs 1,250 (8.33% of Rs 15,000) goes towards EPS. This amount is added to the pool that is created to provide regular pension to the employee.
If you want, you can put 8.33% of your actual salary in the pension pool. This will increase your pension. Apart from this, 1.16% contribution of your employer will also go towards EPS. The remaining 2.51 per cent will go to your EPF.
If after applying for more pension, you find any mistake in it, then you can delete the old application and submit it again. However, if your employer has validated it then you will not be able to submit the application again.
We have taken all measures to ensure that the information provided in this article and on our social media platform is credible, verified and sourced from other Big media Houses. For any feedback or complaint, reach out to us at informalnewz@gmail.com
