One of the World’s largest Social Security Organisations, The Employees’ Provident Fund Organisation (EPFO) warned employers defaulting on contributions, are liable to pay damages and Interest on the amount due.
EPFO 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 |
Employers should ensure timely payment of EPF dues to avoid damages and interest.
EPFO has recently shared a tweet through an official X (formally Twitter) handle saying, “Attention, Employers! Timely payment of Employee Provident Fund (EPF) contributions is important.”
“It incurs both damage and interest due to delay in payment. Be compliant to avoid penalties”, the post added.
Attention, Employers!
— EPFO (@socialepfo) March 7, 2024
Timely payment of Employee Provident Fund (EPF) contributions is important. It incurs both damage and interest due to delay in payment.
Be compliant to avoid penalties.#EmployersLiability #EPFOwithYou #EPFO #EPF #PF #HumHaiNa #पीएफ #ईपीएफ pic.twitter.com/bbREOmOlwh
Recently, In February the Employees’ Provident Fund Organisation (EPFO) fixed the interest rate as 8.25 % for FY 2023-24.
The Central Board recommended an annual rate of interest of 8.25% to be credited on EPF accumulations in members’ accounts for the financial year 2023-24.
This interest rate will be officially notified in the government gazette after approval by the Ministry of Finance. Subsequently, EPFO will credit the approved rate of interest to its subscribers’ accounts.
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