For two consecutive years, the Government will cover the 24 per cent that employees and their employers contribute towards the Employees’ Provident Fund (EPF) every month.
Only those employees who earn not more than Rs 15,000 a month and are hired after October 1, 2020 can claim this benefit. This also includes employees who were laid off post March 1, 2020 and were rehired.
However, only those companies and their employees can seek this benefit with an employee count no more than 1000. For those organisations with a larger employee headcount, the benefit will directly be given to the employees and not the employers.
This subsidy support will be directly extended to Aadhar-linked EPFO accounts of those who are eligible.
The move will empower employees to make investment choices with assured, tax-free returns. The EPF interest rate gets declared every year and also extended to voluntary provident fund (VPF). For VPF, the contributions are voluntary and over the threshold of 12 per cent.
This move will boost the morale and monthly money-in-hand for lower income groups.
The benefits can be claimed till June 30, 2020.