According to EPFO rules, an employee cannot contribute to the Employee Pension Scheme (EPS) once they reach 58 years of age. However, if the employer considers the employee eligible for a deferred pension, contributions can continue.
Earlier, employees earning more than ₹15,000 per month and joining EPS on or after September 1, 2014, were not eligible for EPS. With the new system, this restriction has been removed, and such employees can now contribute to EPS.
To make this process easier, EPFO has introduced a new Electronic Challan-cum-Return (ECR) system, starting from the salary month of September 2025.
This system will automatically flag contributions made for employees above 58 years or earning more than ₹15,000. This ensures incorrect contributions are stopped immediately, avoiding the need for corrections or disputes later.
How PF Pension is Calculated
Currently, there are around 7 crore members of the Employee Provident Fund (EPF) in India.
Employers contribute 12% of the employee’s salary to the EPF, out of which 8.33% goes to the EPS for pension.
The pension is not directly based on the employee’s total EPF contributions, but is calculated using specific rules.
Since September 2014, the maximum EPS contribution is capped at ₹1,250 per month.
If the employer’s contribution exceeds this limit, the extra amount goes to the EPF account, and the pension is calculated only on the capped EPS contribution.
