Queries about the 8.33% component of EPF

POSTED BY Sambaran Mitra ON April 27, 2011 1:31 pm COMMENTS (6)

The employer makes its own contribution towards EPF. However 8.33% of employer’s contribution is deducted and moved to Pension-fund (also called Employee Pension Scheme – EPS).  In the yearly statement I receive from EPFO, nothing is mentioned about the 8.33% deduction.
What does this 8.33% deduction do for me? Do I get any fixed pension per month? If yes, from when the pension starts? What is the amount?

6 replies on this article “Queries about the 8.33% component of EPF”

  1. Sanchay,
    I have a retirement-planning-excel-sheet which I use for determining my saving per month. The moment I factored in the 3529 pension amount, my saving-per-month reduced by 6100. I was so pleasantly surprised that I could not believe it for a while.

    Any idea how the pension is actually delivered and what paperwork needs to be executed for that? I will bug my HR with the same question. I am sure HR will not understand my enthu for a piddly 3529 pension 2-3 decades down the line. However, they have not seen the 6100 reduction in my excel-sheet either.

  2. Sanchay,

    I had to operate the link with a little workaround. There is a field ‘Wage on 15.11.1995’. I was not working in 1995. The page does not accept a zero in the field. To satisfy the tool, I entered 100 there. On pensionable salary I entered 6500.
    Now it is showing that I stand to get 3529INR as pension. Is it 3529 per month for life?

    1. Sanchay Kulkarni says:

      Yes, this is the maximum amount you will get per month. Very huge amount, I am wondering how we are going to spend it, 3259/- will have a big value after 20-30 years 😀

  3. @Sanchay,

    Thanks for the effort you took to post the reply. However, my query is to find out the quantity of pension I will receive, not how much is being contributed to my pension scheme.

    Secondly, I did not understand your reply. Ideally I should receive X from my employer as contribution to EPF(Employee Provident Fund). However employer pays me X – 6500. It seems 6500 goes to EPS (Employee Pension Scheme). I am unable to correlate this observation with what you wrote above.

    1. Sanchay Kulkarni says:

      You can use the following link to calculate your pension.


      For EPF and EPS contribution…please elaborate, your understanding with an example, so that its easy to correlate and reply.

  4. Sanchay Kulkarni says:

    Hi Sambaran,

    The 8.33% is only applicable on basic salary upto 6500/Month.

    1)Your basic salary is 5000/Month, contribution to pension fund is 5000*8.33% = 416.50
    2)Your basic salary is 15000/Month,

    15000-6500 = 8500 * 8.33 = 708.05 Goes to EPF
    6500 * 8.33 = 541.45 goes to pension fund.

    Hence, you can treat 541.45 as the cap for pension fund deduction.

    Refer to below link for details.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.