People who contribute to the Provident Fund will hardly know that after a time they become entitled to a pension. For this, a scheme certificate is required to be submitted.
Most stakeholders of the Employees Provident Fund Organization (EPFO) will not be aware that they may also be eligible for pension at the time of retirement, but for this, they have to get a scheme certificate at the right time. There are around 3.30 lakh pensioners across the country under the EP Scheme.
Who is eligible for a Pension under EPF?
Your employer deposits 8.33% of your basic salary and dearness allowance (DA) in the Employee Pension Scheme (EPS) under the EPFO Contribution. However, a maximum limit of Rs 1,250 has been set for this.
- On attaining retirement age at 58 years, you become eligible for a pension. If you leave the job at the age of 50 years-57 years, you can still avail of the pension, but it will be a little less (reduced pension).
- If you continue to work even after 58 years and continue to contribute to EPF, you can avail pension from 58 years only.
- If someone has contributed to EPF for less than 10 years, then at the age of 58 years they get the option to either withdraw the entire pension amount or get a pension. On the death of the EPF shareholder, his spouse gets pension benefits.
- According to the rules of the EPFO, if someone has contributed to the EPF for less than six months, he does not have the right to withdraw the pension amount.
This is how the Pension is Calculated
How much pension you will get is calculated by multiplying the pension salary (average of last 60 months) by pensionable service by dividing the sum by 70. Under this scheme, you can get a minimum pension of Rs 1,000.
What is the scheme certificate for EPF pension?
The scheme certificate is like a policy for a pension because with its help you get the facility to transfer pension on changing jobs. You must have this certificate to claim a pension.
As per the EPF rules, it is mandatory for shareholders to contribute to EPF for at least 10 years and below 58 years to get a scheme certificate to get a pension.
Those shareholders who have contributed to the EPF for less than 10 years can obtain a scheme certificate to continue the pension service, but this is not mandatory.
If the scheme certificate holder dies, his family will get the pension.
When do you have to get a scheme certificate?
While accepting the job, the provident fund shareholder should get his PF transferred to the new company on the EPFO portal. If the new company is not within the scope of the EPF, then you can take a scheme certificate for taking a pension later.
Shareholders who have already contributed to the EPF for 10 years and do not intend to work further, can obtain a scheme certificate for taking pension at the age of 50-58 years.
How to get EPS Scheme Certificate?
To get the withdrawal benefit and scheme certificate, you need to fill Form 10C.