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Essential for all salaried employees: ESI / PF Registration
Posted on: 25/Jul/2019 4:39:41 PM
ESI and PF (Employee State Insurance & Provident Fund) are the most important avenues/aspects of every salaried employee working in public or private sector as it ensures the employee’s future retired life without any financial hassles. These particulars are to be registered by the employers.
WHAT ARE PROVIDENT FUND AND ESI?
PROVIDENT FUND
Provident fund is a savings scheme for the benefit of the employees run by the government. Employees Provident Fund Organisation (EPFO) is a governmental body which maintains and oversees the fund. Contribution to PF is mandatory for every employee, employers also contribute equally to the provident fund. Amount accumulated in the fund can be withdrawn at the time of retirement along with interest.
ESI
ESI Scheme is a comprehensive Social Security Scheme designed to accomplish the task of socially protecting the ’employees’ in the organized sector against the events of sickness, maternity, disablement and death due to employment injury and provide medical care to the insured employees and their families.
WHO IS REQUIRED TO REGISTER?
Organisations employing 20 or more members are required to register with PF department. Strength of 20 includes contract employees. Companies can also register themselves voluntarily. Employers are required to register with PF department within one month from the date of reaching 20 employees.
Contribution
The ESI Scheme is mainly financed by contributions raised from employees covered under the scheme and their employers, as a fixed percentage of wages. The rates of contribution are:
- A - Employees’ Contribution - 1.75% of Total Wages
- B - Employers’ Contribution - 4.75% of Total Wages
In a situation where all employees are drawing above Rs. 15,000/-, you still need registration, we file a letter that there are no employees who draw a gross salary lesser than Rs. 15,000 per month and therefore no contribution, filing of returns etc. is still required. Therefore ESI registration is purely from a compliance perspective.
THE DOCUMENTS REQUIRED FOR ESI/PF REGISTRATION?
- MOA & AOA with Certificate of Incorporation/Partnership Deed as applicable.
- Copy of PAN
- List of a minimum of 20 Employees with their DOJ and Rate of SalaryCopy of Address proof of Factory / Shop / Firm / Establishment
- Copy of GST Registration Certificate
- Business Number Allotment Form (may be obtained from Pf Office)
