EPF Dues to be paid through Internet Banking Only

As per the latest news updated by EPFO, the grace period of 5 days has been withdrawn from employers. Previously, the PF contributed amount was being deposited by the personnel of employers within a 15 day closing period of every month and also deposited within 5 days grace period. The grace period was meant for the extra time given for remittance of contribution or manual calculation of salaries or wages as per 3 main schemes of EPFO as given below.

• Employees’ Provident Fund Scheme, 1952
• Employees’ Deposit Linked Insurance Scheme, 1976
• Employees’ Pension Scheme, 1995

For the above different schemes, the remittance process in a bank needs more time for settlement manually.

Reason

As per clarification given by EPFO in a circular, “the reason of removal of grace period is due to computerized calculation of PF and online payment made by most companies on ECR (Electronic Challan-cum-Return) basis. So the computerized and online process has reduced the time taken for PF calculation and remittances through a bank.

According to the latest announcement by EPFO, the removal of the 5 day grace period will be applicable with effect from February 2016 and the contributed PF amount for January 2016 needs to be deposited in of month February 2016 only.

EPFO has justified it’s validity about decision of withdrawing 5 days grace period for PF amount deposit by employers and send below letter to all employers:

Dear Employer,

As you may be aware that Central Government vide Notification no. GSR 360 (E) dated 5th May, 2015 has made it mandatory for employers to pay statutory provident fund dues through Internet Banking (INB). Thereafter, employers who make payments of less than Rs. 1 lac per month were allowed to make payments through cheques upto December, 2015.  It has now been made compulsory for all employers to make payments through Internet banking only.
I am sure that this step will improve the ease of doing business in India and moreover, the interface with EPFO and SBI would be eliminated on this account.

With all good wishes,

Yours sincerely,

(K. K. Jalan)
Central Provident Fund Commissioner