PF withdrawn? Here's why your EPS benefits still count

PF is just part of the story—recovering EPS service history is key to secure full pension rights

- Aprajita Sharma

Mr. A worked with his first employer for a couple of years before joining his second employer. There was a gap of two months before he joined the second company, which made him eligible to withdraw his Employees' Provident Fund (EPF). He did so but was unaware of the Employees' Pension Scheme (EPS).

An employee contributes 12% of their basic salary to the EPF, and the employer matches this contribution with an equal amount. However, many employees do not realize that only 3.67% of the employer's contribution is directed to the EPF, while the remaining 8.33% is allocated to EPS to build their future pension.

Being unaware of the EPS means Mr. A could lose out on a huge part of valuable pension contributions made on his behalf during his employment.

Employers and Employees' Provident Fund Organisation (EPFO) rarely inform employees proactively about this distinction or its implications.

While there are ways to claim EPS benefits even after withdrawing the PF amount, successfully doing so requires understanding three key rules related to EPS eligibility and transfers.

It is also important to know that if you joined employment after 1 September 2014 with a basic monthly salary above ₹15,000, the entire 12% employer contribution is directed only to the EPF, and you will not become a member of the EPS.

Decoding EPS

The first rule concerns EPS transfers. When you transfer your EPS from a previous employer to your current one, only your service history (the duration you worked) is transferred—not the accumulated pension amount.

"Your passbook will keep showing EPS funds standalone for all employers so far. Only service history—the duration of your service period with the previous employer, will get transferred to the new employer," said Ketan Das, PF business head, Finright.