Employee Pension Scheme: There has been a demand from the working class for a long time to increase the minimum pension under ‘Pension Scheme-1995’. However, the matter is pending in the Supreme Court on this.
New Delhi: Employee Pension Scheme: There has been a demand from the working class for a long time to increase the minimum pension under ‘Pension Scheme-1995’. However, the matter is pending in the Supreme Court on this. But in the meantime, another good news is coming for the working class.
Plan to bring new pension scheme!
According to the information received by the partner channel Zee Business, EPFO is planning to bring a new pension scheme for better fixed pension. Under the new scheme, the employee will get the option to choose the fixed amount of pension. The good thing is that in addition to the salaried class, self-employed will also be able to register.
Option to get more pension
How much amount you will have to contribute for pension, it will be decided on the basis of salary and remaining length of service. According to sources, preparations are being made to bring a new fixed pension scheme from EPFO. The amount of fixed pension will be decided by the contribution made. You will also have to contribute according to the amount of pension you want.
Now the limit of Rs 1250 per month
Actually, EPFO is preparing for the option of Employee Pension Scheme-1995. The existing amount in EPS is completely tax free. But, the minimum pension in it is very less. Which is repeatedly demanded by the shareholders to increase. At present, the maximum contribution limit is up to Rs 1250 per month. In such a situation, EPFO is preparing to give option to the employed people for the facility of more pension.
Existing rule of EPS
On becoming a member of Employee Provident Fund (EPF), he automatically becomes a member of EPS. According to the rules, the contribution of 12% of the basic salary of the employee goes to PF. The same part is deposited on behalf of the employer in the name of the employee in the EPF. However, 8.33% of the employer’s contribution gets deposited in the EPS. That is, EPS is 8.33% of the basic salary. However, the maximum limit of pensionable salary is Rs 15,000. In such a situation, only a maximum of Rs 1250 can be deposited in the pension fund every month.
This is how pension is calculated
– Formula for EPS Calculation = Monthly Pension = (Pensionable Salary x Number of Years Contribution in EPS Account) /70.
– If someone’s monthly salary (average of last 5 years salary) is Rs 15,000 and the duration of the job is 30 years, then he will get a pension of (15,000 X 30) / 70 = 6428 rupees every month.
How much pension if the limit is removed?
If the limit of 15 thousand is removed to 30 thousand, then you will get pension according to the formula (30,000 X 30) / 70 = Rs 12,857 per month.
Good News for Self Employed
At present, there is an option of pension only for the salaried class in EPS. But if the new rule is implemented then self employed will also be able to register themselves. In this case, the amount of pension will be decided by the contribution made by the self-employed person. That is, you have to contribute according to the amount of pension you want.
Let us tell you that now the amount of EPS is completely tax free. After the new rule comes, the existing EPS-95 pension scheme will also continue. That is, the government is preparing to give the option of EPS. With which people can contribute to get more pension in future.
