The Employees Provident Fund (EPF) is one of the most fundamental statutory obligations for every Indian employer. Under the Code on Social Security 2020 (one of the four new Labour Codes), EPF compliance now operates within a consolidated framework. This guide covers everything an employer needs in 2026 – applicability, contribution rates, deadlines, returns, penalties, and the Labour Code changes you must plan for.
When is EPF Applicable?
The EPF Act applies to every establishment employing 20+ employees. Once registered, EPF coverage continues even if employee count falls below 20. Voluntary coverage is available for smaller establishments.
- All employees earning up to Rs 15,000/month (basic + DA) must be enrolled.
- Employees earning above Rs 15,000/month may opt in or out, but employer contribution remains mandatory.
- Under the new wage definition (Code on Wages 2019), basic + DA must be at least 50% of total remuneration – this typically increases the EPF base.
EPF Contribution Rates 2026
| Component | Employee | Employer |
|---|---|---|
| EPF (Employees Provident Fund) | 12% | 3.67% |
| EPS (Employees Pension Scheme) | – | 8.33% |
| EDLI (Insurance Scheme) | – | 0.50% |
| EPF Admin Charges | – | 0.50% (min Rs 75) |
| Total | 12% | 13% |
Monthly EPF Compliance Deadlines
- 15th of every month – File Electronic Challan-cum-Return (ECR) and pay contribution for the previous month
- 25th of every month – Generate and download challan if late
- 30 April – Annual return Form 5A, 6A
Documents and Returns to Maintain
- Form 5 (new joiners) and Form 10 (left employees) – filed monthly with ECR
- Form 2 (member nomination)
- Form 11 (declaration of EPF transfer)
- Wage register, contribution register, attendance register
- Form 3A (annual member-wise contribution statement)
Penalties for PF Non-Compliance
| Period of Default | Damage Rate |
|---|---|
| Less than 2 months | 5% p.a. |
| 2-4 months | 10% p.a. |
| 4-6 months | 15% p.a. |
| Above 6 months | 25% p.a. |
Plus simple interest at 12% per annum under Section 7Q. Habitual offenders face imprisonment up to 3 years.
Impact of the Code on Social Security 2020
The Code on Social Security consolidates EPF, ESIC, Gratuity, Maternity Benefit and 5 other social security laws into a single statute. Key implications for PF:
- Unified compliance portal – Single registration covers EPF + ESIC + other social security
- Aadhaar-based UAN for portability across employers
- Coverage extends to gig workers, platform workers, and unorganised workers (new)
- State-wise rollout – States must notify their own rules; central code is the baseline
- Higher EPF base due to the new 50% basic pay rule under the Code on Wages
5 Common PF Compliance Mistakes
- Treating allowances as non-PF wages – many allowances are now PFable under the new wage definition
- Missing the 15th-of-month deadline (most common cause of damages)
- Not enrolling employees who exceed Rs 15,000/month earnings ceiling later
- Incorrect Form 11 (no transfer of UAN from previous employer)
- Not updating nominee details after marriage/family events
How TMS Helps With PF Compliance
TMS has been managing PF compliance for 450+ Indian companies for 20 years with zero penalties. Our PF compliance services cover:
- Monthly ECR filing and challan payments
- Employee onboarding (UAN generation, Form 11, KYC)
- Annual returns and audit preparation
- Integrated PF + payroll outsourcing for end-to-end compliance
- Full statutory compliance management
- Transition support under the Code on Social Security
Get a free PF compliance audit for your business
FAQs – PF Compliance India 2026
Is PF compulsory for all employees?
PF is compulsory for employees earning up to Rs 15,000/month basic + DA in establishments with 20+ employees. Those above the ceiling may opt in/out.
What is the new wage definition impact on PF?
Under the Code on Wages, basic + DA must be at least 50% of total. This typically increases PFable wages, raising both employee and employer contributions.
Can a smaller establishment voluntarily register for EPF?
Yes. Voluntary coverage is available with mutual consent of employer and majority of employees.
What happens if PF is paid late?
Damages of 5-25% per annum plus 12% simple interest. Habitual default may attract imprisonment.
See also: India Labour Codes 2026 – Complete Guide | HR Compliance Calendar 2026
