The standard PF contribution rate is 12% of PF wages from the employee and 12% from the employer. The employer’s 12% is not all savings: 8.33% goes to the Employees’ Pension Scheme and the balance of 3.67% to the member’s provident fund account.

Where each rupee goes

Rates were carried over unchanged when the EPF Scheme, 2026 replaced the 1952 scheme (notified 29 June 2026). What changed on 17 September 2026 is the wage ceiling, not the rate. At the new Rs 25,000 ceiling, the monthly split looks like this:

So the member’s PF balance grows by Rs 3,917 that month, while Rs 2,083 builds pension service. Employer cost is higher still once the administrative charges and EDLI are added.

Exceptions that change the rate

• 10% rate: the scheme allows a reduced rate of 10% for categories of establishments the Central Government notifies, which has historically covered certain loss-making units and small employers. Check that your establishment is actually notified before using it.
• Higher pension option: for members who exercised the joint option to pay EPS on wages above the ceiling, the employer-side pension rate is 9.49%, with the extra 1.16% falling on the employer.
• Voluntary top-up: an employee can contribute more through VPF. The employer is not obliged to match it.

Interest is declared yearly. The rate notified for FY 2025-26 is 8.25%, calculated monthly on the running balance and credited after year-end.

Frequently asked questions

Is the employer’s 12% on top of the employee’s 12%?

Yes, both are paid on the same wage. The employer’s 12% is divided between pension and provident fund, while EDLI and admin charges are paid separately on top. Payroll teams see the full picture in the ECR.

Why does my passbook show less than 12% from my employer?

Because 8.33% of the wage went to the pension fund, not your EPF balance. See how entries are laid out in the PF passbook.

Does the 12% apply to my whole salary?

Only to PF wages, which are capped at the ceiling unless you and your employer jointly choose the full wage. The PF wage ceiling and calculation page covers how that base is built.

Plug any salary into the PF Calculator to see the split, or read the broader explainer on EPF.