The Employees’ Provident Funds (EPF) Scheme, 2026

Context: The Ministry of Labour and Employment has notified the Employees’ Provident Funds (EPF) Scheme, 2026, replacing the EPF Scheme, 1952, under the implementation of the Code on Social Security, 2020.

About The Employees’ Provident Funds (EPF) Scheme, 2026:

What is it?

• The Employees’ Provident Funds (EPF) Scheme, 2026 is India’s new statutory provident fund framework replacing the Employees’ Provident Funds Scheme, 1952.
• It has been notified under the Code on Social Security, 2020 to modernize provident fund administration while retaining existing retirement benefits.

Nodal Ministry: Ministry of Labour and Employment.

Executive authority: Employees’ Provident Fund Organisation (EPFO)

Aim:

• To provide financial security and retirement savings for employees.
• To implement the Code on Social Security, 2020 through a modernized provident fund framework.

Key Features:

1. Replaces the 1952 Scheme:

• Supersedes the Employees’ Provident Funds Scheme, 1952.
• Brings provident fund administration under the Code on Social Security, 2020.

2. Seamless Continuity:

• Existing EPF subscribers automatically continue as members.
• No fresh enrolment or transfer of accumulated balances is required.

3. Contribution Rules:

• Employer and employee continue to contribute 12% of wages (10% for notified establishments).
• Mandatory contribution applies only up to the statutory wage ceiling (₹15,000/month).
• Mandatory contribution remains ₹1,800 each (12% of ₹15,000).

4. Voluntary Higher Contributions:

• Employees may voluntarily contribute above the wage ceiling or at rates exceeding 12%.
• Employers may make matching voluntary contributions.
• Such additional contributions can be reduced or discontinued later.

5. Simplified Withdrawal Categories: Earlier 13 categories have been consolidated into three:

• Essential Needs – illness, education, marriage.
• Housing Needs – purchase, construction, home loan repayment, renovation.
• Special Circumstances – specified emergencies.

6. Minimum Balance Requirement:

• Members must retain 25% of total contributions as a minimum retirement corpus.
• Remaining eligible balance can be withdrawn subject to scheme conditions.

7. Withdrawal Provisions:

• Illness: Up to 100% of eligible balance after 12 months of membership.
• Education: Withdrawal permitted after 12 months (maximum 10 times).
• Marriage: Up to 100% of eligible balance (maximum 5 withdrawals).
• Housing: Up to 75% of total balance after 12 months (maximum 5 withdrawals).

8. Protection for Contract Workers:

• Introduces the concept of Principal Employer.
• Principal employer remains ultimately responsible for PF contributions where contractors fail to comply.

9. Employer Compliance: Employers must submit: Aadhaar, PAN, Universal Account Number (UAN), Wage details, Monthly and event-based statutory returns.
10. Digital Governance

• Greater emphasis on Aadhaar-linked UAN and bank accounts.
• Supports faster withdrawals and portability.
• EPFO is also enabling UPI-based withdrawals and WhatsApp-based member services.

11. International Workers

• Existing provisions for international workers continue.
• Existing international members remain covered under the new framework.

12. Retirement Corpus Protection: Partial withdrawals are permitted while ensuring preservation of long-term retirement savings through the mandatory minimum balance.