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Provident Fund (PF)

Provident Fund is a retirement savings scheme — a slice of pay set aside every month, matched by the employer, and paid back with interest when the employee retires or moves on.

Provident Fund (PF) is run by the Employees' Provident Fund Organisation (EPFO). Every month, a fixed share of an employee's Basic pay goes into their PF account, the employer adds an equal share, and you file the total with EPFO. Webelio does the calculation; you upload the file and pay.

Does this apply to my business?​

  • Headcount: PF is mandatory once you have 20 or more employees.
  • Once covered, always covered: if you cross 20 and later drop below, you stay registered.
  • Below 20: you can still register voluntarily, but it isn't required.

If PF applies, register with EPFO and enter your establishment code under compliance setup.

What Webelio does automatically​

For every employee with PF switched on, each payroll run:

  • Works out the PF wage (normally Basic, plus DA if you have it) after any loss-of-pay for the month.
  • Deducts 12% from the employee and adds 12% from the employer.
  • Splits the employer's 12% correctly into the pension and provident-fund parts, plus the small insurance and admin charges.
  • Shows the employee share on the payslip as a deduction, and the employer share as an employer contribution (not deducted from the employee).
  • Builds the ECR file you upload to EPFO.

What you still must do​

  1. Register with EPFO and get your establishment code and each employee's Universal Account Number (see below).
  2. Download the ECR file from Webelio each month.
  3. Upload it to the EPFO portal and generate the challan.
  4. Pay by the 15th of the following month.

The rates in plain numbers​

Who paysRateOn what
Employee12%Basic (+ DA)
Employer12%Basic (+ DA)

The employer's 12% is split behind the scenes into a pension part (8.33%, capped at the ₹15,000 wage ceiling) and a provident-fund part (3.67%). On top of the 12%, the employer also pays a small insurance charge (0.50%) and an admin charge (0.50%) — so the true employer cost is about 13%. Webelio splits these exactly the way EPFO expects, so your challan matches to the rupee.

The ₹15,000 wage ceiling​

The statutory minimum only requires PF on the first ₹15,000 of Basic (+ DA) a month. If someone's Basic is higher, you have a choice:

  • Cap at ₹15,000 (the common default) — PF is calculated on ₹15,000 even if Basic is higher.
  • Contribute on full Basic — some companies pay PF on the whole Basic as a benefit.

Webelio gives you both:

  • A company-wide toggle, "Cap PF wage at ₹15,000", under Settings → Compliance.
  • A per-employee override on their compensation (Default · Capped ₹15,000 · Full Basic), for voluntary higher PF or a one-off exception.
info

An employee earning more than ₹15,000 Basic who has never been a PF member can choose to opt out of PF when they join. Mark that on their compensation and Webelio skips PF for them.

Loss-of-pay lowers PF too​

PF is always calculated on the reduced Basic after loss-of-pay (LWP) days are taken out. For example, on a ₹30,000 Basic with 2 loss-of-pay days in a 30-day month, the Basic drops to ₹28,000 and PF is 12% of ₹28,000 = ₹3,360 each side. Webelio applies loss-of-pay first, then PF — you don't do anything.

UAN — the employee's PF account number​

Every PF member has a Universal Account Number (UAN). It stays with the person across jobs, so their PF savings follow them. Store each employee's UAN on their profile — it's required in the ECR file.

The ECR file​

ECR stands for Electronic Challan cum Return. It's a text file listing every employee's PF contribution for the month.

  1. Run and approve payroll for the month.
  2. Open Reports, find the PF / ECR file, and download it.
  3. Sign in to the EPFO employer portal and upload the ECR file.
  4. The portal generates a challan — pay it (net banking) by the 15th.
warning

If you revise someone's Basic for a past month, their PF for those months changes too. Webelio recalculates the difference (arrears) and adds it to the next ECR — both the employee and employer arrears must be deposited.

What's next​