EPF stands to be one of the prestigious employee funds when it comes to retirement plans. EPF has fulfilled millions of dreams when it comes to post-retirement plans. Keeping these points in view, EPF has been made necessary for individuals earning less than Rs. 15000. Moreover, companies having more than 20 employees are also liable to contribute to the EPF scheme. Every month, an employee and his/her employer contributes 12% of the employer’s basic salary into the PF account.
This amount accounts to be a good sum when interest is calculated on the sum. According to the EPFO guidelines, 8.55 % of the contribution you make is being paid as an interest in the monthly contributions you make. But with this, a question mostly remains answered. What is the accounting year of the Provident fund account? So, in this article, we will get this question answered.
Accounting Year Of The Provident Fund
To get it straight, the provident fund’s accounting year stands to be from the month of March to February of next year. That is from the 1st of March and 28th of February of next year. And the interest that you collect over the 12 months is credited in a lump sum amount on the 31st of every March. So, in order to see the final yearly settlement, it is advised to see into the balance of the PF account. This can be done by performing a check on the EPFO member portal. This has been in practice since 1952, the year from which the establishment was made.
Moreover, considering this, it is always desirable not to quit a job near the end of this period. This is because it will lead to non-contributing months, and the interest granted is also hampered. Moreover, this could also lead to some delay in getting the amount credited to the account.
EPFO implements the guidelines and is related to the EPF account in a robust and efficient manner. This holds true ranging from various disciplines ranging from accounting year to different withdrawal norms. This robust implementation has been in effect for the last 3 decades for so. People often confuse the accounting years for the EPF. Also, the time as and when the interest amount is credited to the account. But with the current pandemic situation, this has been affected this year in 2020. But with the EPFO, we can expect the procedure to resume to normal as soon as possible