One of the World’s largest Social Security Organisations, The Employees’ Provident Fund Organisation (EPFO) employers defaulting on contributions are liable to pay damages and Interest on the amount due.
The Employees Provident Fund Organisation said that employers defaulting on contributions are liable to pay Damages u/s 14B and interest u/s 7Q on the due amount.
The employers should ensure timely payment of EPF dues to avoid damages and interest. In case of delay in payment by the employers will cause the following:-
- Damages are restricted up to 100% of the amount in arrears.
- Simple Interest @12% is payable on the amount due for the entire period of delay.
Damages are levied at the following interest rates:
|Period of Default||Rate of Damages|
|Period less than 2 months||5% per Annum|
|2-4 months||10% per Annum|
|4-6 months||15% per Annum|
|More than 6 months||25% per Annum|
EPFO has recently shared a tweet through an official Twitter handle saying, “Employers defaulting on contributions are liable to pay Damages & Interest on the amount due.”
Employers defaulting on contributions are liable to pay Damages & Interest on the amount due.#AmritMahotsav #epf #HumHaiNa #epfowithyou #ईपीएफओ #पीएफ #HumHaiNa@PMOIndia @Rameswar_Teli @byadavbjp@LabourMinistry @PIB_India @MIB_India@AmritMahotsav @mygovindia pic.twitter.com/KJYhWOqV54— EPFO (@socialepfo) August 17, 2023
Recently, The Central Government has ratified the interest rate of employees’ provident fund (EPF) subscribers to 8.15% which will cover over 6 crore subscribers.
The circular said, “The Ministry of Labour and Employment, Government of India, has conveyed the approval of the Central Government under para 60(1) of Employees’ Provident Fund Scheme, 1952 to credit interest@ 8.15 % for the year 2022-23 to the account of each member of the EPF Scheme as per the provisions under Para 60 of EPF Scheme, 1952.”
“You are accordingly, requested to issue necessary instructions to all concerned for crediting the said interest to the members’ accounts,” the circular added.
Earlier, In March it was said, The Employees’ Provident Fund Organisation (EPFO) will only be providing the rate of interest only after it is ratified by the government through the finance ministry.