Model EPF balance using FY-wise interest rates (8.25% for 2023-24), wage ceiling vs higher wages, VPF contributions, EPS split, and withdrawal TDS rules.
New EPFO update: the Cabinet approved a ₹25,000 wage ceiling from 17 September 2026. The final contribution allocation is still pending official implementation guidance, so this calculator continues to show the established reference model. Read the ₹25,000 ceiling impact guide →
Monthly contribution snapshot
Employee EPF (12%)
₹1,800
Employer EPF
₹550
Employer EPS diversion
₹1,250
VPF (optional)
₹0
Total monthly EPF credit: ₹2,350. EPS diversion is not part of EPF balance.
Totals
| FY | Contrib | Withdrawals | Interest | Closing | Rate |
|---|---|---|---|---|---|
| 2020-21 | ₹28,200 | ₹0 | ₹1,099 | ₹29,299 | 8.5% |
| 2021-22 | ₹28,200 | ₹0 | ₹3,420 | ₹60,919 | 8.1% |
| 2022-23 | ₹28,200 | ₹0 | ₹6,018 | ₹95,137 | 8.15% |
| 2023-24 | ₹28,200 | ₹0 | ₹8,915 | ₹1,32,252 | 8.25% |
| 2024-25 | ₹28,200 | ₹0 | ₹11,977 | ₹1,72,429 | 8.25% |
| 2025-26 | ₹28,200 | ₹0 | ₹15,292 | ₹2,15,921 | 8.25% |
Comparing the established ₹15,000 reference ceiling with the illustrative ₹25,000 ceiling approved effective 17 September 2026. Source: EPFO, Ministry of Labour.
| Contribution | Rate | Amount (₹15K reference) | Amount (₹25K model*) | Goes to |
|---|---|---|---|---|
| Employee | 12% | ₹1,800 | ₹3,000* | EPF Tier 1 |
| Employer → EPS | 8.33% | ₹1,250 (capped) | ₹2,083* (if EPS ceiling rises) | EPS (pension scheme) |
| Employer → EPF | 3.67% | ₹550 | ₹917* | EPF Tier 1 |
| Employer → EDLI | 0.5% | ₹75 (capped) | ₹125* | Life insurance |
| Employer → Admin | 0.5% | ₹75 | ₹125* | EPFO admin charges |
Key insight: The employer's 12% does not go entirely into your EPF balance. Under the established ₹15,000 ceiling, ₹1,250/month (8.33%) flows to EPS for your pension and only ₹550/month (3.67%) grows in EPF. *Under the newly approved ₹25,000 ceiling (effective 17 Sep 2026), applying the same percentages yields ₹3,000 employee EPF, ₹2,083 EPS and ₹917 employer EPF — see our ₹25,000 EPFO wage ceiling guide for what is confirmed vs pending final EPFO notification.
| Financial Year | EPF Interest Rate | Note |
|---|---|---|
| FY 2023-24 | 8.25% | Highest in 3 years; notified Aug 2024 |
| FY 2022-23 | 8.15% | Slight recovery |
| FY 2021-22 | 8.10% | Four-decade low |
| FY 2020-21 | 8.50% | — |
| FY 2019-20 | 8.50% | — |
| FY 2018-19 | 8.65% | — |
| Scenario | TDS Rate | Taxability |
|---|---|---|
| 5+ continuous years of service | Nil | Tax-free |
| <5 years, withdrawal >₹50K, PAN linked | 10% | Taxable as salary income |
| <5 years, withdrawal >₹50K, no PAN | 20% | Taxable as salary income |
| Form 15G/H submitted (nil taxable income) | Nil | Still taxable if income exceeds basic exemption |
| Transfer to new employer (not withdrawal) | Nil | Continuity maintained; no tax |
The EPFO Central Board of Trustees recommended 8.25% for FY 2023-24, the highest rate in three years. This was notified by the Ministry of Labour in August 2024. For FY 2024-25, the rate has not yet been officially declared as of April 2026 — the EPFO typically announces it by March each year. The FY 2022-23 rate was 8.15%.
Employee contributes 12% of basic + DA (full amount goes to EPF Tier 1). Employer also contributes 12%, which under the established ₹15,000 reference ceiling is split as 8.33% to EPS (Employee Pension Scheme, capped at ₹1,250/month) and 3.67% (₹550/month) to EPF, plus 0.5% to EDLI and 0.5% to EPF admin charges. Following the Union Cabinet approval raising the EPFO wage ceiling to ₹25,000 from 17 September 2026, a 12% contribution on ₹25,000 equals ₹3,000/month, though the final post-change EPF/EPS/EDLI split awaits official EPFO notification.
EPF withdrawal before completing 5 continuous years of service is taxable. TDS is deducted at 10% if PAN is provided, 20% if PAN is not linked, on withdrawals above ₹50,000. Withdrawals after 5 continuous years are fully tax-free. For unemployment of 2+ months, 75% can be withdrawn tax-free. Form 15G (below 60 years) or Form 15H (60+) can be submitted if your total taxable income is nil — no TDS is deducted in that case.
The earlier statutory EPFO wage ceiling was ₹15,000 per month. The Union Cabinet approved an increase to ₹25,000 effective 17 September 2026, but the revised contribution allocation, EPS ceiling, ECR mechanics and existing-member treatment are not yet confirmed in the available official implementation guidance. See our ₹25,000 wage-ceiling policy note before using a new cap for payroll calculations.
Voluntary Provident Fund (VPF) is additional contribution by the employee above the statutory 12%. The employer's contribution does NOT increase with VPF. VPF earns the same EPF interest rate (8.25% for FY 2023-24). From FY 2021-22, interest on employee EPF + VPF contributions exceeding ₹2.5 lakh per year is taxable as per income tax slab.
Full EPF withdrawal is allowed: (1) retirement at age 55+, (2) 2 months of unemployment, (3) migration abroad permanently, (4) marriage of a female member, (5) disability preventing further employment. Partial withdrawal for specific purposes (housing, medical, education, marriage) is allowed after 7 years of membership.
EPF interest is calculated on the monthly running balance but credited annually. Formula: Monthly interest = (Opening balance + current month contributions) × annual rate ÷ 12. Interest accrues every month and is credited at financial year close. No interest on accounts inactive for 3+ years (unless pensioner maintaining account).
Employee Deposit Linked Insurance (EDLI) is a life insurance scheme under EPF. The employer pays 0.5% of basic wages (capped at ₹75/month under the ₹15,000 reference ceiling) as EDLI premium. Nominees receive a death benefit of up to ₹7 lakh under EDLI if the member dies while in service. Employees do not pay separately for EDLI.
Educational estimate only. Validate with EPFO passbook, payroll records, and official EPFO notifications. Tax rules are as per FY 2025-26.