How to calculate EPF pension?

Posted on 18th Jul 2018 | 1071 views

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EPF pension calculator

EPF pension calculator is used to calculate pension for the employee who has contributed for minimum 10 Years in EPF is entitled with a pension after attaining the age of 58 Yrs. PF Pension is the only source of regular income for many retired employees. Every private segment employee has a Provident fund pension account. It is very important for every employee to understand all about the EPF pension scheme. The EPF pension is a pension scheme for the employees of any sector who don't have any pension scheme. It is also a retirement saving scheme which gives you lump sum money after the retirement. This scheme gives a guaranteed monthly income after the retirement. The government organization Employee provident fund department administers the pension account of the entire employee. The Employee provident fund pension tries to give the social security to its employees and their families. The families of the employee also get the pension after the death of the employee.

EPF pension calculation formula

EPF pension calculation

EPF pension calculation is based on the no. of years of service. If the number of years of service is less than 10 an employee can withdraw EPF amount. If an employee has completed more than 20 years in service then two years are added in bonus. The portion of service for six or more months is treated as one year and the service less than six months is ignored. For Example, 9 years and 6 months will be rounded to 10 years, 15 years 8 months will be rounded to 16 years but 14 years 2 months will be rounded to 14 years. EPF pension calculation formula is Pensionable Salary X Pensionable Year /70.

Example:

How much pension will Rohan get if he works for 10 years from 1 June 2006 and retires on 1 June 2016

As Rohan has contributed Rs 1250 per month from 1 June 2013, if he retires on 1 June 2016, his pensionable salary for last 60 months or 5 years will be Rs 11,600.

Thus his pension would be (11600X 10/70) = Rs 1657 per month

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