EPFO launches calculator for higher EPS pension. Find out the details here

The Employees’ Provident Fund Organisation (EPFO) has launched the Excel utility-based calculator to estimate the dues you must pay from your EPF balance if you opt for a higher pension from the Employees’ Pension Scheme (EPS). 

However, one must note that today is the last day to apply for a pension on a higher salary. At the same time, there is still a lot of ambiguity about applying for and receiving a higher pension. 

Here is how to download the calculator. 

You will get the calculator on the EPFO Member Sewa portal. The calculator is available under the ‘Important links’ section. Once you click on the pension application link, you will be redirected to a new screen wherein you can download the calculator. To use this calculator, you need to know the date of joining the Employees' Provident Fund (EPF) scheme. You need to fill in the amount from joining the EPF scheme. 

Kriti Kaushik, Partner, Shardul Amarchand Mangaldas & Co. said, "Applicants will need to fill in all the wage details till the date of retirement or February 2023, whichever is later. Basis these, the calculator will provide the amount of contribution or shortfall that remains payable for each month. It will also provide the interest accrued on the contributions and the total amount that will need to be paid including the difference in contribution and interest. That said, one needs to remember that the calculator is only to give a ballpark estimate of the amounts, and the regional PF offices will share the actual numbers."

On May 3, the government notified that the members to contribute at the rate of 1.16% of their salary to the extent such salary exceeds Rs 15000 per month as an additional contribution under the amended scheme to be ultra vires of the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act,1952 (EPF & MP Act). The EPFO should make the necessary adjustments in the scheme within six months. 

Aarti Raote, Partner, Deloitte India, said, “The Government has issued a notification dated 3 May which states that for members exercising the option for contributing toward an additional pension, the employer contribution would be 9.49% (8.33% + 1.16%) of the PF wages. This increased contribution would apply only for the contributions in excess of the PF threshold of Rs 15,000.” 

The EPFO has also released a set of FAQs for those eligible to apply for higher pension. 

Sowmya Kumar, Partner, INDUSLAW, said, "This clarity from the EPFO is much needed, especially for those who were still deciding on whether or not to opt for the higher pension amount. This calculation will crystallize the actual amount (including the 1.16% additional contribution from the employers' contribution and the EPFO declared interest) that will be transferred from the EPF to EPS account and, depending on the circumstances, will also inform the employees if they need to make additional payments. That being said, the calculation sheet requires the employees to input the monthly wages from the time they joined the EPS Scheme, which again presupposes that the employee has the requisite data ready to input into it. For employees who have been in service for several years and are now close to retirement, gathering this data could be cumbersome and will require some administrative support."