The employer is required to deposit the money withheld for Employees Provident Fund into the employee’s PF account every month.
According to the current EPFO guidelines, each month, the employer and employee each contribute 12% of the basic income plus dearness allowance (base salary + DA) to the PF account.
The remaining 3.67 percent of the employer’s contribution is placed into the PF account, leaving 8.33 percent to be contributed to the Employees Pension Scheme (EPS).
Through SMS alerts, the EPFO informs its users on a regular basis about the monthly deposits made into their PF accounts. By going into the EPFO portal, employees can also view the monthly contributions made to the PF account.
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The monthly EPF deductions must be deposited by the employer into the employee’s PF account.
The EPF contribution must be deposited by the employer within 15 days of the last month’s salary being paid.
However, many employers fail to deposit the PF amount at times. In such cases, the employees can take several steps to deduct the amount from their salary towards PF contribution.
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Employees who believe their employer has failed to deposit their PF contributions may submit a complaint with the EPFO. The retirement fund governing authority investigates the employer after receiving a complaint. If it is discovered throughout the investigation that the EPF amount was taken out but not deposited, legal action would be taken.
The EPFO officials also have the authority to charge interest and start collection procedures for late deposits of EPF deductions. According to the EPF Act, there would be a fine if the money deducted for the provident fund was not deposited. In addition, EPFO has the right to report the employer to the police for criminal breach of trust under Sections 406 and 409 of the Indian Penal Code (IPC).
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According to Section 14-B of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, EPFO is authorised to seek damages from employers that fail to make required contributions to PF accounts.
The EPFO will provide the employer with a reasonable opportunity to be heard before taking punitive action.
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The current tax laws state that if employers don’t make timely deposits into the PF account, they cannot claim tax relief for EPF contributions.
