All you need to know about Employees Pension Scheme?

It is very basic in practically all association to PF commitment to workers account. Which known as Employee opportune store conspire. Furthermore, it is packaged with another retirement advantage called Employees Pension Scheme (EPS). A large number of workers don't mindful of what about it is. In the wake of perusing this I might want to perusers think about EPS benefits, highlights, conditions for move/withdrawal. Which is must to design one's funds well. How about we plunge into the subtleties.

About the EPS - Employees Pension Scheme

Employees Pension scheme is a retirement benefit scheme. Was Introduced to provide the monthly fixed income after the retirement (58 years age) throughout the life. All Employees who enrolled in EPF scheme would automatically become members of the EPS as well. An amount equivalent to 8.33% of employer monthly contribution would be credited in employees EPS account. However no interest is provided for the balances in EPS account unlike balances EPF account.

Transfer of EPS balances when changing organization

Balances in EPS account cannot be transferred to current employer ID from previous employers ID. EPS Balances continue to lie in respective employers ID. You can transfer balances in EPF account of previous employer to current employer ID.

Conditions for EPS Withdrawal

Employees’ eligible to withdraw EPF balances if they completed 10 years of service. Employees eligible to withdraw EPF balances even before completion of 10 years of service, if they unemployed for 2 months or more.

Conditions for Entitlement of Pensions

Employees eligible to get monthly pension if they completed 10 years of service & attained 58 years of age. Employees eligible to get monthly pension even at the age of 50 years at reduced pension.

Calculation of Monthly Fixed Pension

Pension = (Pensionable salary X Pensionable service) / 70

Pensionable Salary = Average Salary (Basic + DA) of last 60 months. Maximum of Rs.15K

Pensionable Service = No. of years of service. Maximum of 35 years

Example:

Mr. A attained age of 58 years & he served 40 years service throughout his career. His pensionable salary was 25k for last 7 years.

Pension = (Pensionable salary X Pensionable service) /70

Mr. A will get monthly pension of Rs.7.5K throughout his life.

Pension for family in case of death of employee

Employee family will get pension if employee deceased in following cases;

1. Where employer has contributed at least one month of EPS contribution to employee account
2. Where employee completed 10 years of service before attaining age of 58 years
3. Where employee deceased after commencement of monthly pension