PF Calculator Online
The PF calculator is a tool to assess total provident fund return at the retirement age. The EPF calculation considers numerous factors. You will find many online provident fund calculators. However, due to changes in the rates of key components, you may not find the exact PF amount. This post shows you how to calculate your provident fund amount. Also, find how the contributions are calculated. And how the interest rate and dearness allowance affect the PF calculation. Learn how to calculate PF with a simple method. Also find other PF related information on our blog. iepfbalance.in carries procedures to check PF balance status and UAN status too.
Every employee should keep a track of the provident fund account. How much money is contributed by the employer? How much amount is deducted from the salary? What is the percentage of the deduction on the basic salary? What is the maximum basic salary for EPFO membership? You will find answers to all such significant questions. The post aims at acquainting employees with their provident fund calculation. By law, a company having more than 20 employees need to register with EPFO.
Provident Fund Calculation
The provident fund amount is calculated by % of deduction from salary. It also considers employer’s contribution and interest credit by the government. Following method is to show you how to calculate PF. The major components of the PF calculator are following:
- Employee’s contribution
- Employee’s share towards family pension funds
- Employer’s contribution
- PF interest rate
Other factors like a tax on PF withdrawal also impact the final PF amount. Any changes and updates in the rates of interest will make difference to the final PF amount. The PF interest rates are reviewed every year by the government. So you can calculate your PF amount with the help of PF calculator.
- Employee’s contribution – 12% of the salary (as per new rule, your salary for EPF calculation is basic salary + Dearness Allowance + uniform allowances)
- Employer’s contribution – 12% of the salary is contributed to your EPF account by the employer
- Out of the 12% of employer’s contribution 8.33% goes to the EPS – Employee Pension Scheme
- Hence, only 3.67% of the employer’s contribution remains in the EPF account
The employer’s contribution to the employee’s PF account is exempted from tax. However, the employee’s contribution is taxable. But an employee can claim a deduction of this tax under section 80C of the Income tax act.
The maximum wage ceiling which was Rs 6500 before is increased to Rs 15000 from the year 2014. Also note, if your basic salary is above Rs. 6,500 per month, the employer can only contribute 8.33% of 6500 to your pension scheme. The balance goes to your EPF account as usual.
The provident fund thus accumulated also accrue interest of 8.8%. Currently, the PF interest rate is fixed at 8.8%. This PF interest rate is reviewed every year and is subject to change during every financial year. The interest rate keeps on changing between the ranges of 8.5% to 12%. The PF interest rate for the past three financial years is as under:
- 2012-2013: 8.5%
- 2013-2014: 8.75%
- 2014-2015: 8.75%
- 2015-2016: 8.8%
PF interest rate is also an important factor in PF calculator. The government credits the interest annually in April on the basis of compounded interest. This interest amount added is exempted from the tax. To avail the maximum benefit of this compounded interest, early PF withdrawals are not advisable.
For more information on PF interest rate, refer to our EPF rules and regulations posted on our blog. Due to the changes in the interest rate, it is not possible to come at the precise PF amount. But PF calculator is still a useful tool for employees. It allows you to estimate your PF amount which will be accumulated in your account over a period of time. Now, employees can view their EPF passbook online to get details of the PF calculation. The passbook will also show how much amount your employer is contributing. You may study your passbook and the prevailing interest rates. This will help you estimate the provident fund using above method. Learn more procedures related to provident fund at our website.