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EPFO: Currently, the mandatory salary limit for Employees’ Provident Fund is ₹15,000 per month. The EPFO is now preparing to increase this to ₹25,000. A major update on this could come in the new year 2026. This means that ₹2,083 will be deposited each month instead of ₹1,250. This will benefit 65 million employees..
EPFO: Almost all employees in India have a PF (Provident Fund) account. PF accounts in India are operated by the Employees’ Provident Fund Organization (EPFO). Meanwhile, important news has emerged regarding the EPFO. (The EPFO is considering raising the salary threshold for mandatory membership from ₹15,000 to ₹25,000. This means that even higher-paid employees will now receive social security benefits under the EPF and EPS schemes.
According to Labor Ministry sources, this proposal is likely to be discussed at the EPFO board meeting in December or January, where final approval is expected. If approved, this proposal will directly impact the country’s more than 65 million EPFO subscribers. It could be included under EPFO 3.0. This would be a major step towards a complete upgrade of the employees’ social security system in the future.
PF Funds Will Jump
If this decision is passed, employees’ monthly pension fund deposits will increase from ₹1,250 to ₹2,083. This could be included under the new EPFO, ‘EPFO 3.0,’ with a major update expected in early 2026. Both the EPF and EPS schemes require both employees and employers to contribute 12 percent each. The employee’s full 12 percent goes to the EPF, while the employer’s contribution is split between 8.33 percent and 3.67 percent.
According to officials, the increase in the salary limit will rapidly increase the EPF-EPS corpus, boosting both retirement pensions and interest for employees. Currently, the EPFO has a total fund of approximately ₹26 lakh crore and has 76 million active members.
Know the Current Rules
According to the current rules, under EPS-95, contributions to the pension fund are only counted up to a maximum of ₹15,000 of the basic salary. This means that even if your salary is ₹30,000 or ₹40,000, the pension fund contribution is limited to only ₹15,000.
Why is a change in the EPS ceiling necessary?
1. The EPS limit was last increased from ₹6,500 to ₹15,000 in 2014.
2. Since then, inflation, basic pay, and universal minimum wages have all increased.
3. Now, the minimum wage is fixed at around ₹18,000, so the ₹15,000 EPS ceiling has fallen behind the actual wage structure.
4. That’s why many EPFO board members believe that “Social Security will only be effective if the contribution limit is increased.”
5. This will not only strengthen the pension fund but also provide better security to employees after retirement.
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