Use this skill whenever asked about Indian EPF (Employees' Provident Fund), ESI (Employees' State Insurance), or employer social security obligations. Trigger on phrases like "PF contribution India", "EPF employer", "ESI contribution", "provident fund India", "PF admin charges", "EDLI", "EPS pension", "ECR filing", "PF return", "ESI threshold", "PF applicability", "12% PF", "employer PF obligation", or any question about computing, depositing, or filing EPF/ESI in India. This skill covers EPF contribution rates, EPS, EDLI, ESI rates and thresholds, applicability criteria, monthly filing (ECR), and compliance deadlines. ALWAYS read this skill before touching any Indian PF/ESI employer work.
Accountant-reviewed general reference. Reviewed by Mayur Deokaras reference material, not for your specific facts. Don't file, pay, or take a position on it without a professional reviewing your situation.
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Test EPF and ESI applicability
Confirm the establishment is covered before computing anything. Count the persons employed and check whether the area is ESI-notified. EPF coverage, once triggered, continues even if headcount later drops.
Watch for: EPF applies to establishments employing 20 or more persons. ESI applies to establishments employing 10 or more persons in notified areas. If neither threshold is met (and there is no voluntary registration), stop.
EPF and Miscellaneous Provisions Act, 1952; ESI Act, 1948
Classify wages and apply the ceilings
For each employee, separate PF wages (Basic + DA only) from gross wages. Flag who is ESI-covered by comparing gross wages to the ESI ceiling, and note that the PF wage ceiling caps EPS even where the employer contributes on actual Basic + DA.
Watch for: PF wages are Basic + DA only, never gross. ESI covers employees at or below the ESI gross wage ceiling (a higher ceiling applies for employees with disability).
EPF and Miscellaneous Provisions Act, 1952; ESI Act, 1948
Every figure is drawn from this Tax Guide and cited to its source.
Employer total
12% of Basic + DAEPF Act 1952
EPF account
3.67%EPF Act
EPS (pension)
8.33% (capped at ₹15,000/month = max ₹1,250/mo)EPF Act
Employee contribution
12% of Basic + DAEPF Act 1952
EPF Admin
0.50% of total EPF wages (min ₹500/month if >20 employees)EPFO notification
EDLI (life insurance)
0.50% of Basic+DA (capped at ₹15,000) = max ₹75/moEPFO notification
EDLI Admin
Nil (removed 01-04-2017)EPFO notification
Employer ESI
3.25% of gross wagesESI Act 1948
Employee ESI
0.75% of gross wagesESI Act 1948
Total ESI
4%ESI Act
Reviewed against the cited tax authorities by Mayur Deokar on 2026-06-06.
Items flagged for further clarification are tracked separately and excluded here.
This block is generated from verified skill_facts — edit the facts, not the prose.
Quick Reference
| Field | Value |
|---|---|
| Country | India (Republic of India) |
| Tax/Contribution | EPF (Provident Fund) + ESI (State Insurance) |
| Currency | INR only |
| Applicable period | FY 2025-26 (April 2025 -- March 2026) |
| EPF legislation | Employees' Provident Funds and Miscellaneous Provisions Act, 1952 |
| ESI legislation | Employees' State Insurance Act, 1948 |
| Administering bodies | EPFO (Employees' Provident Fund Organisation); ESIC (ESI Corporation) |
| Filing portal (EPF) | Unified Portal (unifiedportal-emp.epfindia.gov.in) |
| Filing portal (ESI) | ESIC Portal (esic.gov.in) |
| Skill version | 1.0 |
EPF Contribution Summary
| Component | Employer (%) | Employee (%) | On |
|---|---|---|---|
| EPF (Provident Fund) | 3.67% | 12% | Basic + DA |
| EPS (Employee Pension Scheme) | 8.33% | Nil | Basic + DA (capped at ₹15,000/month) |
| Total employer contribution | 12% | -- | Basic + DA |
| Total employee contribution | -- | 12% | Basic + DA |
Employer Administrative Charges
| Charge | Rate | On |
|---|---|---|
| EPF Admin charges | 0.50% | Total EPF wages (minimum ₹500/month if >20 employees) |
| EDLI (Employees' Deposit Linked Insurance) | 0.50% | Basic + DA (capped at ₹15,000/month) |
| EDLI Admin charges | Nil (removed w.e.f. 01-04-2017) | -- |
ESI Contribution Summary
| Component | Rate | On |
|---|---|---|
| Employer ESI | 3.25% | Gross wages (all components except certain exclusions) |
| Employee ESI | 0.75% | Gross wages |
| Total ESI | 4% | Gross wages |
ESI Wage Ceiling
| Threshold | Amount |
|---|---|
| ESI applicability (employee) | Gross wages ≤ ₹21,000/month |
| ESI applicability (disability employee) | Gross wages ≤ ₹25,000/month |
Applicability Thresholds
| Scheme | Applies When |
|---|---|
| EPF | Establishment employs 20 or more persons |
| ESI | Establishment employs 10 or more persons (in notified areas) |
Conservative Defaults
| Ambiguity | Default |
|---|---|
| Unknown whether establishment is covered | Verify employee count -- do not assume |
| Unknown wage components | Include all regular earnings as PF wages unless specifically excluded |
| Unknown ESI area notification | Check ESIC notification for the area |
Wage Components for PF
| Included in Basic + DA (PF Wages) | Excluded from PF Wages |
|---|---|
| Basic salary | House Rent Allowance (HRA) |
| Dearness Allowance (DA) | Overtime allowance |
| Retaining allowance | Bonus (statutory or otherwise) |
| Cash value of food concession (if not provided) | Commission |
| Conveyance allowance | |
| Retrenchment compensation | |
| Gratuity |
Employer 12% Breakup
| Component | Rate | Cap |
|---|---|---|
| EPF account (employee's individual PF) | 3.67% | On full PF wages |
| EPS (Pension fund) | 8.33% | Capped at ₹15,000/month (max ₹1,250/month to EPS) |
| If PF wages > ₹15,000 | Balance of 8.33% above cap goes to EPF | Full 12% effectively goes to EPF |
Example: Employee with Basic + DA = ₹30,000/month:
EDLI Details
| Item | Detail |
|---|---|
| Purpose | Life insurance for EPF members |
| Employer contribution | 0.50% of Basic + DA (capped at ₹15,000/month) |
| Maximum EDLI contribution | ₹75/month per employee |
| Benefit on death | Up to ₹7,00,000 (₹7 lakh) |
| Employee contribution | Nil |
International Workers PF Treatment
| Scenario | PF Treatment |
|---|---|
| Indian employee sent abroad (no SSA country) | PF continues on Indian salary |
| Foreign national working in India (from SSA country) | Exempt from PF if covered in home country |
| Foreign national from non-SSA country | PF mandatory at full rate |
Wage Components for ESI
| Included | Excluded |
|---|---|
| Basic salary | Annual bonus (statutory) |
| DA | Retrenchment compensation |
| HRA | Encashment of leave on superannuation |
| City Compensatory Allowance | Gratuity |
| Overtime (for contribution purposes) | |
| All other regular cash payments |
Contribution and Benefit Periods
| Contribution Period | Benefit Period |
|---|---|
| 1 April -- 30 September | 1 January -- 30 June (following) |
| 1 October -- 31 March | 1 July -- 31 December (following) |
ESI Benefits
| Benefit | Coverage |
|---|---|
| Medical benefit | Full medical care for employee and family |
| Sickness benefit | 70% of wages for up to 91 days |
| Maternity benefit | Full wages for 26 weeks |
| Disablement benefit | 90% of wages (temporary); pension (permanent) |
| Dependants' benefit | 90% of wages as pension to dependants |
| Funeral expenses | ₹15,000 |
ECR Details
| Item | Detail |
|---|---|
| What is ECR | Monthly return declaring employee-wise PF contributions |
| Due date | 15th of the following month |
| Payment mode | Online through EPFO Unified Portal |
| Format | Upload employee data (UAN, name, wages, contribution breakup) |
| Late payment penalty | Simple interest at 12% per annum on delayed deposits |
| Damages | 5% to 25% per annum depending on delay period |
ESI Monthly Contribution Details
| Item | Detail |
|---|---|
| Due date | 15th of the following month |
| Payment mode | Online through ESIC portal |
| Return | Half-yearly return (now largely subsumed in monthly online filing) |
| Late payment penalty | Simple interest at 12% per annum |
| Damages | Up to 25% of arrears |
Annual Returns
| Return | Due Date | Covers |
|---|---|---|
| EPF Annual Return (Form 3A/6A) | Now via monthly ECR (no separate annual) | Automated through monthly ECR |
| ESI Return (Form 5) | Half-yearly (11 May and 11 November) | Contribution register |
Employee: Basic = ₹12,000/month, DA = ₹3,000/month, HRA = ₹5,000/month Gross = ₹20,000/month (below ₹21,000 ESI threshold)
Example 1 Calculation Table
| Component | Employer | Employee |
|---|---|---|
| EPF (on Basic + DA = ₹15,000) | ₹15,000 × 3.67% = ₹550.50 | ₹15,000 × 12% = ₹1,800 |
| EPS (capped at ₹15,000) | ₹15,000 × 8.33% = ₹1,249.50 | Nil |
| Total PF employer | ₹1,800 (12% of ₹15,000) | ₹1,800 |
| EDLI | ₹15,000 × 0.50% = ₹75 | Nil |
| PF Admin | ₹15,000 × 0.50% = ₹75 | Nil |
| ESI (on gross ₹20,000) | ₹20,000 × 3.25% = ₹650 | ₹20,000 × 0.75% = ₹150 |
| Total employer cost | ₹2,600 | -- |
| Total employee deduction | -- | ₹1,950 |
Employee: Basic + DA = ₹40,000/month, Gross = ₹65,000/month (above ₹21,000 ESI threshold)
Example 2 Calculation Table
| Component | Employer | Employee |
|---|---|---|
| EPF (on ₹40,000, if contributing on actual) | ₹40,000 × 3.67% = ₹1,468 | ₹40,000 × 12% = ₹4,800 |
| EPS (capped at ₹15,000) | ₹15,000 × 8.33% = ₹1,250 | Nil |
| Remaining to EPF | ₹40,000 × 8.33% − ₹1,250 = ₹2,082 | Nil |
| Total PF employer | ₹4,800 (12% of ₹40,000) | ₹4,800 |
| EDLI | ₹15,000 × 0.50% = ₹75 | Nil |
| PF Admin | ₹40,000 × 0.50% = ₹200 | Nil |
| ESI | Not applicable (gross > ₹21,000) | Not applicable |
| Total employer cost | ₹5,075 | -- |
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Review status
Accountant-reviewed
Reviewed by a named licensed practitioner against the stated sources, as general reference material.
Accountant-reviewed
Reviewed by Mayur Deokar · 6 June 2026
A named accountant reviewed this complete Guide version within the stated scope. It is not a guarantee.
View review record →Other India computations in the OpenAccountants Tax Library.
Compute employee and employer EPF
Apply the employee EPF rate to PF wages as a deduction, and the employer EPF rate to PF wages as employer cost. Treat the two 12% obligations as separate.
Watch for: Employee contributes 12% of Basic + DA; employer contributes 12% of Basic + DA. These are separate obligations, not one shared 12%.
EPF and Miscellaneous Provisions Act, 1952
Split the employer 12% into EPS and EPF
Divide the employer 12% into EPS (pension) and the EPF account. Compute EPS on PF wages capped at the wage ceiling; route the 3.67% share plus any 8.33% balance above the cap into the EPF account.
Watch for: EPS is 8.33% of PF wages but capped at the wage ceiling (max pension contribution at the cap). The EPF account takes 3.67%, and where PF wages exceed the ceiling the balance of the 8.33% above the cap also goes to the EPF account so the full employer 12% is preserved.
EPF and Miscellaneous Provisions Act, 1952 (Employees' Pension Scheme)
Add EDLI and PF admin charges
Add the employer-only EDLI and PF administrative charges to total employer cost. Do not deduct these from the employee.
Watch for: EDLI is charged on Basic + DA capped at the wage ceiling and is employer-only. PF admin charges apply to total EPF wages subject to a monthly minimum. EDLI admin charges were removed with effect from 01-04-2017.
EPFO notification under the EPF and Miscellaneous Provisions Act, 1952
Compute ESI for covered employees
For employees within the ESI ceiling, apply the employee ESI rate as a deduction and the employer ESI rate as employer cost, both on gross wages (broader than PF wages).
Watch for: ESI is computed on gross wages. If an employee crosses the ceiling mid contribution period, ESI continues to the end of that period and coverage ceases only from the next period.
ESI Act, 1948
Deposit and file by the monthly due date
Deposit EPF via the ECR on the EPFO Unified Portal and deposit ESI via the ESIC portal, uploading employee-wise data (UAN, name, wages, contribution breakup). Do both by the statutory monthly deadline.
Watch for: The ECR (EPF) and the ESI monthly contribution are both due by the 15th of the following month.
EPFO (ECR); ESIC (ESI monthly contribution)
Quantify any late-deposit exposure
If a deposit is late, compute interest plus damages on the delayed amount so the working paper shows the true cost of the delay, not just the base contribution.
Watch for: Late deposits attract simple interest at 12% per annum plus damages (rising with the length of delay) from the date of default.
EPF and Miscellaneous Provisions Act, 1952; ESI Act, 1948
Assemble the working paper and offer review
Compile per-employee EPF (EPS/EPF split), EDLI, admin charges, and ESI, plus total employer cost and total employee deductions, labelled as an estimate. Deliver it as a working paper and offer Mayur Deokar a review before any deposit or filing.
Watch for: Present figures as a working paper, not a filed return; name the reviewing OpenAccountants Partner and route to review before filing.
What Mayur checks before signing off
Ready to work through your own numbers? Add this Guide to your AI and it takes it from here, then routes the finished paper for an accountant to review.
Add to your AIECR (EPF monthly)
15th of following monthEPFO
ESI monthly
15th of following monthESIC
Employer total EPF contribution
12% of Basic + DAEPF Act 1952
EPF account split (employer)
3.67%EPF Act
EPS (pension)
8.33% (capped at ₹15,000/month = max ₹1,250/mo)EPF Act
Employee EPF contribution
12% of Basic + DAEPF Act 1952
PF wage ceiling
₹15,000/month (statutory; many contribute on actual)EPF Act
EPF applicability
Establishments with 20+ personsEPF Act
EPF Admin
0.50% of total EPF wages (min ₹500/month if >20 employees)EPFO notification
EDLI (life insurance)
0.50% of Basic+DA (capped at ₹15,000) = max ₹75/moEPFO notification
EDLI Admin
Nil (removed 01-04-2017)EPFO notification
EDLI death benefit
Up to ₹7,00,000EPFO
Employer ESI contribution
3.25% of gross wagesESI Act 1948
Employee ESI
0.75% of gross wagesESI Act 1948
Total ESI
4%ESI Act
ESI wage ceiling
₹21,000/month (₹25,000 for disability)ESI Act
ESI applicability
Establishments with 10+ persons (notified areas)ESI Act
ECR (EPF monthly) filing deadline
15th of following monthEPFO
ESI monthly filing deadline
15th of following monthESIC
Late payment penalty
12% per annum (simple interest) + damages 1% per month or part thereof from the date of defaultEPF Act / ESI Acts
Quick Reference
| Field | Value | |---|---| | Country | India (Republic of India) | | Tax/Contribution | EPF (Provident Fund) + ESI (State Insurance) | | Currency | INR only | | Applicable period | FY 2025-26 (April 2025 -- March 2026) | | EPF legislation | Employees' Provident Funds and Miscellaneous Provisions Act, 1952 | | ESI legislation | Employees' State Insurance Act, 1948 | | Administering bodies | EPFO (Employees' Provident Fund Organisation); ESIC (ESI Corporation) | | Filing portal (EPF) | Unified Portal (unifiedportal-emp.epfindia.gov.in) | | Filing portal (ESI) | ESIC Portal (esic.gov.in) | | Skill version | 1.0 |
EPF Contribution Summary
| Component | Employer (%) | Employee (%) | On | |---|---|---|---| | EPF (Provident Fund) | 3.67% | 12% | Basic + DA | | EPS (Employee Pension Scheme) | 8.33% | Nil | Basic + DA (capped at ₹15,000/month) | | **Total employer contribution** | **12%** | -- | Basic + DA | | **Total employee contribution** | -- | **12%** | Basic + DA |
Employer Administrative Charges
| Charge | Rate | On | |---|---|---| | EPF Admin charges | 0.50% | Total EPF wages (minimum ₹500/month if >20 employees) | | EDLI (Employees' Deposit Linked Insurance) | 0.50% | Basic + DA (capped at ₹15,000/month) | | EDLI Admin charges | Nil (removed w.e.f. 01-04-2017) | -- |
ESI Contribution Summary
| Component | Rate | On | |---|---|---| | Employer ESI | 3.25% | Gross wages (all components except certain exclusions) | | Employee ESI | 0.75% | Gross wages | | **Total ESI** | **4%** | Gross wages |
ESI Wage Ceiling
| Threshold | Amount | |---|---| | ESI applicability (employee) | Gross wages ≤ ₹21,000/month | | ESI applicability (disability employee) | Gross wages ≤ ₹25,000/month |
Applicability Thresholds
| Scheme | Applies When | |---|---| | EPF | Establishment employs 20 or more persons | | ESI | Establishment employs 10 or more persons (in notified areas) |
Conservative Defaults
| Ambiguity | Default | |---|---| | Unknown whether establishment is covered | Verify employee count -- do not assume | | Unknown wage components | Include all regular earnings as PF wages unless specifically excluded | | Unknown ESI area notification | Check ESIC notification for the area |
Wage Components for PF
| Included in Basic + DA (PF Wages) | Excluded from PF Wages | |---|---| | Basic salary | House Rent Allowance (HRA) | | Dearness Allowance (DA) | Overtime allowance | | Retaining allowance | Bonus (statutory or otherwise) | | Cash value of food concession (if not provided) | Commission | | | Conveyance allowance | | | Retrenchment compensation | | | Gratuity |
PF wage ceiling (voluntary cap)
₹15,000/month is the statutory wage ceiling for EPF. Employers may choose to contribute on actual Basic + DA even if above ₹15,000 (most large employers do this). EPS is always capped at ₹15,000/month.
Employer 12% Breakup
| Component | Rate | Cap | |---|---|---| | EPF account (employee's individual PF) | 3.67% | On full PF wages | | EPS (Pension fund) | 8.33% | Capped at ₹15,000/month (max ₹1,250/month to EPS) | | If PF wages > ₹15,000 | Balance of 8.33% above cap goes to EPF | Full 12% effectively goes to EPF |
EDLI Details
| Item | Detail | |---|---| | Purpose | Life insurance for EPF members | | Employer contribution | 0.50% of Basic + DA (capped at ₹15,000/month) | | Maximum EDLI contribution | ₹75/month per employee | | Benefit on death | Up to ₹7,00,000 (₹7 lakh) | | Employee contribution | Nil |
International Workers PF Treatment
| Scenario | PF Treatment | |---|---| | Indian employee sent abroad (no SSA country) | PF continues on Indian salary | | Foreign national working in India (from SSA country) | Exempt from PF if covered in home country | | Foreign national from non-SSA country | PF mandatory at full rate |
SSA
Social Security Agreement (India has SSAs with ~20 countries).
Basis of ESI calculation
ESI is calculated on **gross wages** (broader than PF wages)
Wage Components for ESI
| Included | Excluded | |---|---| | Basic salary | Annual bonus (statutory) | | DA | Retrenchment compensation | | HRA | Encashment of leave on superannuation | | City Compensatory Allowance | Gratuity | | Overtime (for contribution purposes) | | | All other regular cash payments | |
Contribution and Benefit Periods
| Contribution Period | Benefit Period | |---|---| | 1 April -- 30 September | 1 January -- 30 June (following) | | 1 October -- 31 March | 1 July -- 31 December (following) |
ESI Benefits
| Benefit | Coverage | |---|---| | Medical benefit | Full medical care for employee and family | | Sickness benefit | 70% of wages for up to 91 days | | Maternity benefit | Full wages for 26 weeks | | Disablement benefit | 90% of wages (temporary); pension (permanent) | | Dependants' benefit | 90% of wages as pension to dependants | | Funeral expenses | ₹15,000 |
Crossing the ESI threshold mid-period
If an employee's wages exceed ₹21,000/month mid-contribution period: - ESI contributions continue for the remainder of that contribution period - Employee ceases to be covered from the next contribution period - Employer must ensure coverage for the full 6-month period once started
ECR Details
| Item | Detail | |---|---| | What is ECR | Monthly return declaring employee-wise PF contributions | | Due date | 15th of the following month | | Payment mode | Online through EPFO Unified Portal | | Format | Upload employee data (UAN, name, wages, contribution breakup) | | Late payment penalty | Simple interest at 12% per annum on delayed deposits | | Damages | 5% to 25% per annum depending on delay period |
ESI Monthly Contribution Details
| Item | Detail | |---|---| | Due date | 15th of the following month | | Payment mode | Online through ESIC portal | | Return | Half-yearly return (now largely subsumed in monthly online filing) | | Late payment penalty | Simple interest at 12% per annum | | Damages | Up to 25% of arrears |
Annual Returns
| Return | Due Date | Covers | |---|---|---| | EPF Annual Return (Form 3A/6A) | Now via monthly ECR (no separate annual) | Automated through monthly ECR | | ESI Return (Form 5) | Half-yearly (11 May and 11 November) | Contribution register |
Example 1 Calculation Table
| Component | Employer | Employee | |---|---|---| | EPF (on Basic + DA = ₹15,000) | ₹15,000 × 3.67% = ₹550.50 | ₹15,000 × 12% = ₹1,800 | | EPS (capped at ₹15,000) | ₹15,000 × 8.33% = ₹1,249.50 | Nil | | Total PF employer | ₹1,800 (12% of ₹15,000) | ₹1,800 | | EDLI | ₹15,000 × 0.50% = ₹75 | Nil | | PF Admin | ₹15,000 × 0.50% = ₹75 | Nil | | ESI (on gross ₹20,000) | ₹20,000 × 3.25% = ₹650 | ₹20,000 × 0.75% = ₹150 | | **Total employer cost** | **₹2,600** | -- | | **Total employee deduction** | -- | **₹1,950** |
Example 2 Calculation Table
| Component | Employer | Employee | |---|---|---| | EPF (on ₹40,000, if contributing on actual) | ₹40,000 × 3.67% = ₹1,468 | ₹40,000 × 12% = ₹4,800 | | EPS (capped at ₹15,000) | ₹15,000 × 8.33% = ₹1,250 | Nil | | Remaining to EPF | ₹40,000 × 8.33% − ₹1,250 = ₹2,082 | Nil | | Total PF employer | ₹4,800 (12% of ₹40,000) | ₹4,800 | | EDLI | ₹15,000 × 0.50% = ₹75 | Nil | | PF Admin | ₹40,000 × 0.50% = ₹200 | Nil | | ESI | Not applicable (gross > ₹21,000) | Not applicable | | **Total employer cost** | **₹5,075** | -- |
EPF applicability for small establishments
EPF is mandatory for establishments with 20+ employees. Establishments with fewer may voluntarily register. Once registered, coverage continues even if numbers drop below 20.
Contract labour PF/ESI responsibility
The principal employer is responsible for PF/ESI of contract workers if the contractor fails to deposit. Both principal employer and contractor must be registered.
Fixed-term employee coverage
Fixed-term employees are entitled to same PF/ESI benefits as regular employees from day one. No waiting period.
PF Trust exemption
Large employers may apply for EPF exemption to manage their own PF trust. Must provide equal or better benefits. Trust must maintain accounts as per EPFO norms.
VPF rules
Employee may contribute above 12% voluntarily (up to 100% of Basic + DA). Employer contribution remains at 12% -- no additional employer obligation for VPF.
New establishment registration deadlines
A new establishment must register with EPFO within one month of employing 20 persons. ESI registration within 15 days of applicability.
Rendered from the canonical facts model · method attested Jun 6, 2026 (covers the method, not the currency of individual figures). General reference only — confirm with a qualified professional before acting.
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