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All About ESIC and PF with New Rates of ESIC (https://taxguru.in/corporate-law/esic-pf-rates-esic.html)

 ROHITKUNAL1 (https://taxguru.in/author/rohitkunal1/) (https://www.printfriendly.com)

| Corporate Law (https://taxguru.in/category/corporate-law/) - Articles (https://taxguru.in/type/articles/)
 (https://taxguru.in/wp-admin/post.php?post=689117&action=edit) 24 Jul 2019 (https://taxguru.in/2019/07/24/)  43,230 Views
 9 comments (https://taxguru.in/corporate-law/esic-pf-rates-esic.html#pcomments)
Applicability of the ESI scheme

The ESI scheme is applicable to all factories and other establishments as defined in the Act with 10 or more persons employed in such establishment and
the beneficiaries’ monthly wage does not exceed Rs 21,000 are covered under the scheme. Whether the employer has employed 10 or more employees, all
employees employed by the employer, agnostic of the salary are reckoned.

The applicability of the scheme is explained through a flow chart below:

ESIC contribution rates (Reduced w.e.f. 01/07/2019)

Particulars Current Rate Reduced Rate

Employer Share 4.75% 3.25%

Employee Share 1.75% 0.75%

Total 6.50% 4.00%

ESIC Return Due Date.

ESIC Return filling and payment can be both done at the same time. Hence, the ESI return due date is the same as that of payment. I.e., on or before 15th
of every month.

Penalty for Delayed Payment

Delayed remittance of ESIC /PF deposit will incur penal damages. The penal charges, as specified by the EPFO, ESIC are as follows:

S. No Time-Period of Delay Rate of Penalty

1 Delay for up to 2 months 5% per annum

2 Delay ranging from 2 months to 4 months 10% per annum

3 Delay ranging from 4 months to 6 months 15% per annum

4 Delay exceeding 6 months 25% per annum (It may correspondingly go up to 100%)

Applicability of EPF Registration for Employers

EPF registration is mandatory for all establishments-

Which is a factory engaged in any industry having 20 or more persons, and

To any other establishment employing 20 or more persons or class of such establishments which the Central Government may, by notification specify
in this behalf.

Central Government may apply any establishment employing less than 20 employees after giving not less than two months’ notice for compulsory
registration
/
Where the employer and majority of employees have agreed that the provisions of this act should be made applicable to the establishment, they may
themselves apply to the Central PF Commissioner. The Central PF Commissioner may apply the provisions of this Act to that establishment after passing the
notification in the Official Gazette from the date of such agreement or from any subsequent date specified in the agreement.

Some establishments having less than 20 employees would also be required to obtain PF registration but that is voluntary registration. All the employees will
be eligible for a PF from the commencement of their employment and the responsibility of deduction & payment of PF lies with the employer.

Contribution Rate (%) Employee’s Contribution Rate Employer’s Contribution Rate

(%) (%)

A/c No. 1: PF Contribution Account* 12.00 3.67

A/c No. 2: PF Admin Charges Account – 0.50

A/c No. 10: EPS Contribution Account – 8.33

A/c No. 21: EDLIS Contribution Account – 0.50

Total Contribution 12.00 13.00

Monthly payable amount under EPF Administrative charges is rounded to the nearest rupee and a minimum of Rs 500/- is payable.

Note:- If the establishment has no contributory member in the month, the minimum administrative charge will be Rs 75/-

1. The contributions are payable on maximum wage ceiling of Rs. 15000/-

2. The employee can pay at a higher rate and in such case employer is not under any obligation to pay at such higher rate.

3. To pay contribution on higher wages, a joint request from Employee and employer is required [Para 26(6) of EPF Scheme]. In such case employer
has to pay administrative charges on the higher wages (wages above 15000/-).

4. For an International Worker, wage ceiling of 15000/- is not applicable.

Documents Required for ESI and PF Registration.

1. Name of the company. (Incorporation Certificate)

2. Company’s PAN (Proprietor’s, in case of proprietorship concern) and Incorporation Certificate.

3. Copy of the licenses available in the name of the company/Firm. (like GST/MSME).

4. Address of the company with address proof.

5. ID, Pan and Address proof of Proprietor / Director / Partner of the company.

6. Email address, Mobile number of Proprietor / Director / Partner of the company.

7. Specimen Signature as per attached format

8. Digital Signature

9. Details of 10 & 20 Employees (10 for ESIC & 20 for EPF) (as per Sheet attached)

10. Consent Letter as per attached format (In case EPF Voluntary Registration)

You may contact the author for further information at 7503206951 or taxwizersconsultant@gmail.com

Disclaimer: The above article is only for information purpose and is on based on the author’s interpretation of the relevant provision. The same should not
be considered as professional advice.

Tags: EPF (https://taxguru.in/tag/epf/), EPFO (https://taxguru.in/tag/epfo/), ESIC (https://taxguru.in/tag/esic/), Provident Fund (https://taxguru.in/tag/provident-fund/)

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Name: ROHIT KUMAR (https://taxguru.in/author/rohitkunal1/)

Qualification: Graduate
Company: TAXWIZERS CONSULTANT PVT LTD
Location: DELHI, New Delhi, IN
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 9 Comments
chandan kumar says:

/
Dear sir,
Plz. help me that my co. is registered both ESi and PF. Problem that i want not alloted PF only alloted ESI some employee so possible or not.

 January 22, 2020 at 4:35 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2087742#respond)

esic.html/#comment-2087742)

KULDEEP says:

show basic salary above 15000

 January 23, 2020 at 5:54 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2087938#respond)

esic.html/#comment-2087938)

MONU PRATAP SINGH says:

call me on 7503206951

 January 23, 2020 at 6:19 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2087943#respond)

esic.html/#comment-2087943)

GURPREET SINGH says:

On another website, it is mentioned that Employer’s contribution towards (ESI+PF), including administrative charges comes to 13.61% of the wages. It also mentions that the
calculation is to be done on a maximum amount (wages) of Rs. 6,500/-.
You are requested to kindly confirm whether it is correct. Please also elaborate on why a ceiling of Rs. 6,500/- is provided.

 January 19, 2020 at 1:33 am (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2087206#respond)

esic.html/#comment-2087206)

MONU PRATAP SINGH says:

Epf Wages was changed from September 2014 from 6500 to 15000, and also administrative charges @0.5% from 01.06.2018.

 January 20, 2020 at 11:29 am (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2087388#respond)

esic.html/#comment-2087388)

DINTAKURTHI VENKATA RAMESH BABU says:

thanks for providing valuable information

 December 25, 2019 at 3:08 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2083998#respond)

esic.html/#comment-2083998)

MONU says:

15th july mentioned wrongly, Esic Rate has been effected from 1st july 2019

 August 21, 2019 at 2:31 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2067480#respond)

esic.html/#comment-2067480)

Baldev Saini says:

Sir, thanks to update, as i know about the changes, these are WEF 1st July, 2019 not 15th July, 2019.

Thanks
Baldev Saini

/
  July 25, 2019 at 12:24 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2063421#respond)

esic.html/#comment-2063421)

pukhraj jain says:

The changes are effective from 01.07.2019.

 July 25, 2019 at 5:02 pm (https://taxguru.in/corporate-law/esic-pf-rates- Reply (https://taxguru.in/corporate-law/esic-pf-rates-esic.html?replytocom=2063475#respond)

esic.html/#comment-2063475)

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