In a move that could come as a relief for many, retirement body Employees Provident Fund Organisation (EPFO) on Monday released a set of guidelines for employees to opt for a higher pension. As part of its latest guidelines, subscribers can now go beyond the pensionable salary capped at Rs 15,000 a month. The deadline to apply for higher pension under EPS is March 3, 2023.
EPFO’s new procedure will allow subscribers and their employers to jointly apply for a higher pension under the Employees’ Pension Scheme (EPS). This means that now members can contribute 8.33 per cent of their ‘actual basic salary’.
It is worth mentioning here that the pensionable salary cap, was in 2014, increased from Rs 6,500 per month to Rs 15,000 per month by the EPS amendment of August 2014. This allowed members and their employers to jointly contribute 8.33 per cent of their actual salaries towards EPS, if exceeding the cap.
The EPFO provided all EPS members a six-month window to opt for the amended scheme for higher pension. However, several subscribers missed this opportunity. Hence, a new window has been given based on a Supreme Court judgement in November 2022.
Are you eligible for higher pension from EPFO?
In its circular, the EPFO clarified that the following subscribers would be eligible for higher pension after the Supreme Court ruling:
Existing employees, or those who retired after September 1, 2014, are eligible to claim higher pension based on actual salary beyond the prescribed ceiling in the Employees’ Pension Scheme (EPS) of 1995.
The employees and employers who had contributed on salary exceeding the prevalent wage ceiling of Rs 5,000 or 6,500.
Subscribers who did not exercise joint option under the Employees’ Pension Scheme (EPS) of the pre-amendment scheme while being members of EPS-95.
How to apply for higher pension?
The eligible subscribers would have to apply jointly with their employer for the enhanced benefit in the application form prescribed by the commissioner and all other required documents like joint declaration etc. More details related to timelines of the application process will be provided by the Regional PF Commissioners soon.
Further, all applications will have to be digitally logged.
