EPS contribution eligibility

Hi Community-

We have a discussion on EPS here. We have a few related questions.

1. What is eligibility on EPS contribution?
2. EPF and EPS. Both are different? Which works better in what ways?

Please share your thoughts.




The employee and the employer each contribute 12% of the employee’s basic salary and Dearness Allowance (DA) towards the scheme. While the entire contribution of the employee goes towards EPF, only 3.67% of the employer’s share goes towards EPF, while the remaining is contributed towards EPS.

As per current laws, an employee contributes 12 per cent of his/her monthly salary (basic plus dearness allowance) to his/her EPF account and the employer matches this contribution . Out of the employer’s contribution , 8.33 per cent is contributed to EPS account

Two popular schemes are the Employees’ Provident Fund ([EPF]/ scheme and the Employees’ Pension Scheme ([EPS]


EPS - Employee Pension Scheme - Is A Monthly Pension Payable To Employees On Their Superannuation Or Death Or Permanent Disability

EPF - Employee Provident Fund - A Savings Scheme Where The Employee Gets The Entire Accumulated Balances At The Time Of His Retirement (Or Earlier – For Some Specific Events).

EPS Contribution:-
No Employee Contribution
Employer Contribution - 8.33% Of (Basic + DA). Maximum EPS Contribution will Be 1250 per month (8.33% of Rs. 15000)

EPF Contribution -
Employee Contribution - 12% Of (Basic + DA)
Employer Contribution - 12% Of (Basic + DA) Minus Employer EPS Contribution

Notification dated August 22, 2014 which became effective from September 1, 2014
For new employees, if an individual’s Basic + DA exceeds Rs 15,000 a month, then he will not be eligible to join the EPS scheme. Then complete employee & employer contribution will be deposited in EPF only.


Both EPF and EPS work in more or less the same way, they help employees have a retirement when they are no longer earning. The difference however lies in the way they function

  • Under EPF, both you and your employer contribute 12% of your basic salary towards your EPF account.

  • Thus, 24% of your basic salary gets contributed to EPF each month.

  • This money can however be withdrawn only when you change your job or when you require money due to emergency circumstances. When you change your organization, the EPF account gets transferred to your new company.

However, of the employer’s 12% contribution, 8.33% is contributed to EPS, while the remaining 3.67% is transferred to EPF. The maximum amount that can be deposited in the EPS account is Rs. 1250.

The biggest difference between the two is that in the case of EPF, the deposited amount gets an interest which is determined by the Government and currently stands at 8.75%. In the case of EPS, no interest is provided as it is a pension scheme.


Hi Anu,

  1. EPS eligibility will start with your EPF. If you are a member of EPF then you will also be a member of EPS.
  2. EPF and EPS are more or less same because both focus towards an employee retirement.
    Its difficult to measure as in which works better. Both are having their own features which are good for different kind of employee work situation.

In the recent amendment in EPS in 2014 that if any employee whose PF wage is more than 15000/- and was not an EPF member earlier or was a member but withdrawan the amount and closed the account will have no EPS deduction of 8.33%. The complete 24% will go to an employee EPF account which is good.

Hope this information will help you to understand EPF and EPS difference.


Dear Ankit,

A few more queries. Thanks.

  1. If employee XYZ is working with Company A gets registered under EPF for the first time, and his Basic + DA exceeds Rs. 15,000, then he will not be part of EPS scheme. However he joins Company B, where his Basic + DA is less than Rs. 15,000. Will he be now coming under EPS scheme?

  2. Later same employee XYZ joins Company C where again his Basic + DA exceeds Rs. 15,000. Now what will happen to his EPS?



Question is specially asked to Ankit but still i am replying , it may help you.

  1. Yes, if Basic+DA is less than 15000/- EPS will be deducted.
  2. Once became the part of EPS then it will continue., But if you have withdrawal the amount and closed that account then you can treat this case as new and EPS will not be attracted.

Hope this will help you.


dear Shefali ,

An employee is entitled to receive pension only after completion of minimum 10 years of eligible service . frequently changing the company would not be considered to be part of the EPS scheme . he /she will be can join the new scheme, provided the refund the withdrawal benefit along with the interest. Thereafter, person will be entitled to receive pension after you turn 58 years old, if he/she complete a minimum of 10 years of contributory service by then under the FPS. In case an individual is leaving a company that comes under the EPFO to join a company that doesn’t, it is vital that they take the Scheme Certificate from the EPFO. This certificate can be submitted in case you join a company that comes under EPFO in the future. In case the individual does not join a company until he/she attains the age of 50 years or 58 years, the certificate can be submitted at the respective EPF field office. The certificates can also be accumulated in case individuals have worked for different employers and have completed less than 10 years of service. However, in case individuals join another company that comes under EPFO, the certificate will not be needed. he will only get the benefit once all the criteria is fulfilled as per the norms of the of EPS.

also i’am sharing EPS Eligible service calculation for your ready ref!

In case an employee has worked for 6 months or more, the service period will be considered as 1 year. However, if the service period is less than 6 months, the working duration will not be taken into account. Therefore, if an employee has worked for 10 years and 7 months, the number of years of service will be taken as 11. However, if the employee has worked for 10 years and 5 months, the number of years of service will be considered as 10.

i hope this information helps you to understand the processes .
thanks and have great day ahead !
Vineeta Solanki


Thant’s a very detailed explanation and thanks for taking the time to enlighten us.

Welcome to the community @vineeta, keep posting a have a great experience.

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@ Dinesh , thanks for your comment and will defiantly addup and enhanced our knowledge through this platform , wishing you all the very best to the good work and good luck to all the community members. .

there is one quote : " if our hopes of building a better and safer world and community are to become more than wishful thinking . we will need to engagement of volunteers more than ever."


Thank you so much for detailed response, Vineeta! It certainly clarifies my doubts! :slightly_smiling_face: