EPFO: If you are a salaried employee whose PF is deducted from your salary every month, this news is very important for you. The Employees’ Provident Fund Organization (EPFO) has made five major changes to the Employee Pension Scheme, which will directly impact your future pension.
1. Pension will now be based on average salary
Previously, pensions were calculated based on an employee’s last salary. Now, they will be calculated based on the average salary over the last 60 months, or five years. This will benefit employees whose salaries have increased gradually. This rule has been in effect since September 1, 2014, but the EPFO has now simplified the process to ensure that every employee receives the correct pension.
2. Maximum pension limit increased to ₹15,000 per month
Previously, the maximum pension was limited to ₹7,500 per month. The EPFO has now increased it to ₹15,000 per month. This significant decision was made following a Supreme Court directive. This will provide relief to retired employees who had high salaries but received a lower pension amount due to the pension limit.
3. Pension will now be available from the age of 50
Previously, the minimum age for pension withdrawals was 58 years, but this has now been reduced to 50. This means that employees can now begin receiving their pension as early as 50. However, the amount may be slightly reduced if they withdraw their pension early.
4. Pension claims will now be available online
EPFO has further strengthened its digital platform. Now, all pension claim processes, including form filing, document uploading, and approval, can be completed through the EPFO website or mobile app. Previously, pension claims took months to process; now, this process will be completed within a few weeks.
5. There will be no loss in pension even if you change your job.
The EPFO has simplified pension portability. Now, if an employee changes jobs, their previous service will automatically be added to the new job’s record.
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