EPF amount Calculation Formula

To understand how to calculate EPF, let us have an example.

• Employee basic salary + dearness allowance = Rs 14,000
• Employee contribution towards the EPF = 12% * 14,000 = Rs 1,680
• Employer contribution towards the EPF = 3.67% * 14,000 = Rs 514
• Employer contribution towards EPS = 8.33% * 14,000 = Rs 1,166.
• The total contribution by the employer and employee towards the EPF account of the employee = Rs 1,680 + Rs 514 = Rs 2,194.
• Now with the Applicable interest rate 8.25% p.a, the monthly earned interest will be; 8.25%/12 = 0.679%

Assuming the employee joined the Firm XYZ in April 2019. The total EPF contribution for April will be Rs 2,194. The EPF scheme will not pay any interest for April. The total amount in EPF account May 2019 = Rs 4,388 (Rs 2,194+ Rs 2,194). He receives an interest of Rs 4,388 * 0.679% = Rs 29.79.

The calculation will be continued until the retirement age (60) of the employee. The calculator will show the PF final amount.

How can PF Calculator Help You?

• Financial Planning Support: A PF calculator aids salaried individuals in planning their retirement by providing a clear view of their projected Provident Fund (PF) balance at retirement, helping them understand how much they need to save monthly to meet their financial goals.
• Effortless Tracking: It automates the calculation of total contributions and interest accrued over time, eliminating the hassle of manual calculations and ensuring accuracy in the tracking of their retirement savings.
• Immediate Updates: Salaried users receive immediate updates on any changes in PF policies, such as adjustments in interest rates or contribution ratios, enabling them to make informed decisions about their investments and savings strategy.

How to Use PF Calculator?

• Enter contribution amount for Provident Fund.
• Current EPF Interest Rate is automatically entered.
• Now, fill the duration column by using slider.
• In the end, select the frequency of the contribution which is Monthly, Quarterly, Half-yealy and Yearly.
• The ClearTax EPF Calculator will show you the EPF funds that will be available to you at retirement.

EPF Calculator Advantages

• The EPF Calculator shows you the accumulated amount in your EPF fund at retirement. You get an idea of the retirement corpus, which helps you manage other investments in a better manner.
• You may use the EPF Calculator to increase your contribution towards retirement. If you feel the corpus accumulated at retirement is not enough to meet your requirements, then increase the percentage of your contributions to get a bigger corpus at retirement.
• The EPF Calculator is easy to use and shows the EPF corpus at your retirement in seconds.
• The EPF Calculator helps you to plan your retirement. You can increase the contribution percentage if you want to retire at an early age. You get an idea of the EPF corpus at different retirement periods, which helps you get the finances for early retirement.

Things to know About EPF Contributions

• EPF contributions are not taken only from your salary. Your employer is also bound to make equal contributions to your EPF account every month.
• Employees must link the Aadhaar number and the bank account with the UAN.
• You can nominate anyone for your EPF account. In case of the account holder’s demise, the nominee will pay the account balance.
• You can change the nominee by submitting Form 2 to your company’s finance department or the EPFO department.
• About 8.33% of your employer’s monthly contribution (up to Rs 1,250) will be redirected to the Employee Pension Scheme (EPS). This will help you get a monthly pension once you retire and fulfil certain conditions.
• If you decide to quit your job and withdraw the balance from your EPF account once and for all, you will only be able to remove a portion of the amount based on the purpose of withdrawal. Some valid reasons are unemployment, retirement, purchase of land, purchase/construction of a house, renovating a house, wedding, education, repaying a home loan, and medical reasons.
• If you are a retired person and have had continuous employment for the last 10 years, you can withdraw 100% of the EPS account balance.
• In case, you don’t have continuous employment for the last 10 years, you can only withdraw money from the EPS account, according to the slabs based on your previous drawn salary as mentioned in the Table ‘D’ below: