Any establishment or factories that have 20 or more employees has to obtain this registration within 30 days of reaching this number, and this stays irrespective of the salary. Organisations are required to contribute a fixed amount towards PF out of employee salary. Also, an establishment with less than 20 employees, with the consent of its employees, can seek voluntary coverage and avail the benefits of Provident Fund.
It is an important investment plan for the Employees’ future needs and is made mandatory by the Government for employees drawing a basic salary less than INR 15000/-.
The fund that is accumulated is tax-free & gives employees long-term financial security.
If the withdrawal is made after 5 years of registration, then the maturity amount with interest will also be tax-free.
The employees are eligible to withdraw the partial amount for expenses dealing with house construction, daughter’s wedding and in case of crisis and illness.