PF & ESI Registration (Combo)
PF and ESI registration for employers
Flexible Pricing Plans
Rs. 5000Rs.5000 + GST@18%
- Free Consultation
- Document collection & submission
- Submitting Application to PF & ESIC
- Follow-ups with PF & ESIC
- For establishment having employees upto 30
Rs. 6500Rs.6500 + GST@18%
- All services of Rapport START plus
- For establishment having employees upto 50
What is Employee State Insurance (ESI) & Provident Fund (PF)
1. Employees’ State Insurance (ESI) Scheme
ESI is a contributory fund that enables Indian employees to participate in a self-financed, healthcare insurance fund with contributions from both the employee and their employer.
The scheme is managed by Employees’ State Insurance Corporation, a government entity, that is a self-financing, social security, and labor welfare organization.
The entity administers and regulates ESI scheme as per the rules mentioned in the Indian ESI Act of 1948.
ESI is one of the most popular integrated need-based social insurance schemes among employees. The scheme protects employee interest in uncertain events such as temporary or permanent physical disability, sickness, maternity, injury during employment, and more. The scheme provides both cash benefits and healthcare benefits.
What is the criteria for Covered Units
- All units that are covered under Factory Act and Shops and Establishment act are eligible for ESI.
- Where 10 or more people are employed irrespective of their monthly earnings.
Note: Some states (such as Gujarat and Punjab) have upper limits on the number of employees for eligibility of the ESI scheme.
- Units which are located in the scheme-implemented areas. The government plans to implement ESI across the entire country by 2022 so all units will be considered as Covered Units.
How to identify eligible employees?
- All employees of a covered unit, whose monthly incomes (excluding overtime, bonus, leave encashment) does not exceed Rs. 21,000 per month, are eligible to avail benefits under the Scheme.
- Employees earning daily average wage up to Rs.176 are exempted from ESIC contribution.
- However, employers will contribute their share for these employees.
What salary components are applicable to ESI deductions?
- ESI contributions (from the employee and employer) are calculated on the employee’s gross monthly salary.
- Most people face challenges in understanding ESI deduction rules because they aren’t clear about the concept of Gross Salary. So let us explain this concept first.
- Gross salary is described as the total income earned by the employee, while working in their job, before any deductions are made for health insurance, social security and state and federal taxes.
- For ESI calculation, the salary comprises of all the monthly payable amounts such as:
- Basic pay,
- Dearness allowance,
- City compensatory allowance
- House Rent Allowance (HRA)
- Incentives (including sales commissions)
- Attendance and overtime payments
- Meal allowance
- Uniform allowance and
- Any other special allowances
- The gross monthly salary, however, does not include Annual bonus (such as Diwali bonus), Retrenchment compensation, and Encashment of leave and gratuity.
Collection of ESI Contribution
- It is the employers responsibility to contribute to the ESI fund by deducting the employees’ contribution from wages and combining it with their own contribution.
- An employer is expected to deposit the combined contributions within 15 days of the last day of the Calendar month. The payments can be made online or to authorized designated branches of the State Bank of India and some other banks.
The rates of contribution, as a percentage of gross wages payable to the employees, is explained in the table below
|Contribution Type||Percentage of Gross Pay||Example Gross Salary||Contributions|
|Employee Deduction||0.75%||Rs 15,000||15,000 * 0.75% = 112.50|
|Employer Contribution||3.25%||15,000 * 3.25% = 487.50|
|Total Contributions for this employee||112.50 + 487.50 = Rs 600.00|
In case, the gross salary of the employee exceeds Rs. 21,000 during the contribution period (explained next), the ESI contributions would be calculated on the new salary and not Rs 21,000.
For example, if the salary of an employee increases to Rs. 22,000 per month, then the ESI would be calculated on Rs. 22,000 instead of Rs. 21,000 during the contribution period.
Contribution Period and Benefit Period
Payroll administrators often face confusion when employees salaries change – especially when the monthly salary exceeds the ESI limits of Rs 21,000.
To handle this situation, ESI has a concept of contribution periods during which the ESI contributions have to continue, even when the salary exceeds the maximum limits.
There are two contribution periods each of six months duration and two corresponding benefit periods also of six months duration.
|Contribution Period||Cash Benefit Period|
|1st April to 30th September||1st January of the following year to 30th June|
|1st October to 31st March of the following year||1st July to 31st December|
After the commencement of a contribution period, even if the gross salary of an employee exceeds Rs. 21,000 monthly, the employee continues to be covered under ESI scheme till the end of that contribution period.
The contribution is deducted on the new salary. Let us look at an example to understand this better.
If an employee’s gross salary increases in June from Rs. 18,000 (within ESI limit) to Rs. 22,000 (above ESI limit), the deductions for ESI will continue to happen till the end of the ESI contribution period i.e. September.
And the deduction amount for both the employee and employer will be calculated on the increased gross salary of Rs. 22,000.
At the end of the contribution period, if the employee salary is more than the ESI limit, no further deductions and contributions are required. The employee will still be covered under ESI till 30th June of the following year.
Similar rules apply when an employees salary increases in the 2nd contribution period.
2. Rules related to Employee Provident Fund (EPF)
Just like the ESI scheme, the Employees Provident Fund (EPF) is a Contributory fund with contributions from both the employee and their employers. While the focus of the ESI scheme is healthcare, Provident Fund is focused towards post Retirement Income and Benefits. EPF is a compulsory and contributory fund for Indian organizations under “The Employees’ Provident Fund and Miscellaneous Provisions Act 1952”.
Employee and Employer Contributions to the Employee Provident Fund (EPF)
For EPF, both the employee and the employer contribute an equal amount of 12% of the monthly salary of the employee.
Employees can contribute more than 12% of their salary voluntarily, however the employer is not bound to match the extra contribution of the employee.
For PF contribution, the salary comprises of fewer components:
- Basic wages
- Dearness Allowances (DA)
- Conveyance allowance and
- Special allowance
The employers monthly contribution is restricted to a maximum amount of Rs 1,800. Even if the employee’s salary exceeds Rs 15,000, the employer is liable to contribute only Rs 1,800 (12% of Rs 15,000).
Details of EPF
The statutory compliance associated with PF contribution has some lesser known facts associated with it.
The contributions by the employee and employer are divided into two separate funds:
- EPF (Employee Provident Fund) and
- EPS (Employee Pension Scheme).
The breakup happens as follows:
|Total contribution||12% of monthly salary||12% of monthly salary (subject to a maximum of Rs 1,800)|
|Employee Pension Scheme (EPS)||0||8.33% of monthly salary (subject to a maximum of Rs 1,250)|
|Employee Provident Fund (EPF)||Full amount||3.67% of monthly salary|
|Example Monthly Salary: Rs 12,000|
|Total Contribution||12,000 * 12% = Rs 1,440||12,000 * 12% = Rs 1,440|
|EPS||0||12,000 * 8.33% = Rs 999.60|
|EPF||Rs 1,440||12,000 * 3.67% = Rs 440.40|
Procedure for PF & ESI Registration (Combo)
Tell us about your company
You need to fill our simple PF & ESI registration questionnaire and submit documents.
After submitting your PF & ESI registration documents, details provided by you will be verified.
Submission Application to PF & ESIC
There are different application forms to be filled and submitted. We will fill the these forms using the information provided by you.
Your work is now completed
Congratulations, we will send you EPF & ESIC Registration license and login credentials on your mail id
Documents required for PF & ESI Registration for Employers
Documents in Respect of Directors/ Partners/ Proprietor:
- Copy of PAN Card
- Copy of Aadhaar Card
- Mobile Number and Email ID
- DSC of any one Director (Signatory for EPF & ESIC)
Documents in Respect of Entity/ Company:
- Copy of PAN card (Not required in case of proprietorship firm)
- Address proof (COI/ Shop & Establishment License).
- MOA/ AOA
- Cancelled Cheque (bearing preprinted name & a/c no).
- Certificate of Registration (GST)
- Employees Details along with Salary.
- Signature Card.
- Balance Sheets of last 3 years (applicable in case of company incorporated date and date of coverage in PF/ESI is different).
Documents / forms to be signed by all employees for office records:
- EPF Form 11
- EPF Form 2
- ESIC Declaration form
Advantages of PF & ESI Registration (Combo)
Advantages of ESI
- It provides complete medical benefits
- It includes dependents
- It can be used at different ESI dispensaries and hospitals
- Any payments made will be reimbursed
- It takes the needs of the disabled into account
- Access to Medical care in ESI Dispensaries/Hospitals
Key Features of EPF
- Tax-free earnings - Interest on PF is exempt from tax at maturity or beyond 5 years
- Financial security - Retirement, resignation and on a loss of income
- Benefits - A long-term investment for employees & Pension, Insurance after retirement
Eligibility of PF & ESI Registration (Combo)
- PF registration is mandatory for organization where the employees count is more than 20 members, and the employees with salary less than Rs 15000/-have to mandatorily member of EPFO.
- Registration with Employee State Insurance (ESI) is a necessary step for all businesses with more than 10 employees.
PF & ESI Registration (Combo)
Establishments or Factories must get themselves registered within 15 days of the Act becoming applicable to them by submitting an Employer’s Registration Form to the relevant Regional Office.
Once the online form is completed & upon submitting the form online, the applicant will receive OTP Pin on his registered email id and mobile number, which shall be verified to activate establishment login.
Once the registration is completed, the department allots the EPF & ESIC registration certificate and login credentials on registered email id.
Once login credentials received, must register employees in EPF & ESIC portal as declared in the registration form to get UAN number and Insurance number.
Establishment must file monthly return before 15th of next month.