The Ministry of Labour and Employment has notified the Employees' Provident Funds Scheme, 2026 vide G.S.R. 525(E), dated 29th June 2026, in exercise of the powers conferred under clause (a) of sub-section (1) of section 15 of the Code on Social Security, 2020. This notification supersedes the Employees' Provident Funds Scheme, 1952, in its entirety, except as respects things done or omitted to be done before such supersession.
This is not an incremental amendment. It is a complete re-issue of the provident fund framework under the new labour codes architecture, and every establishment, exempted trust, and compliance function currently working off the 1952 Scheme will need to revisit its processes in light of the new provisions.
Applicability
The Scheme applies to every establishment to which Chapter III of the Code on Social Security applies, and additionally to establishments belonging to or under the control of the Central or State Government, or set up under any Central or State Act, that employ the number of employees specified in the First Schedule to the Code and whose employees are not already covered by a contributory provident fund or old-age pension arrangement under any other law.
Structure of the Scheme
The Scheme is organised into nine chapters:
Chapter I – Preliminary (definitions and applicability) Chapter II – Officers of the Central Board Chapter III – Membership Chapter IV – Exemption Chapter V – Contributions and Charges Chapter VI – Responsibilities, Forms and Returns Chapter VII – Maintenance of Accounts Chapter VIII – Transfers, Nominations, Payments and Withdrawals Chapter IX – Annual Report
Contribution Framework
The employer's contribution continues at the rate of twelve per cent of wages, matched by an equal employee contribution. A reduced rate of ten per cent applies to classes of establishments specifically notified by the Central Government. The Central Government retains the power to specify different contribution rates for particular classes of employees, and, significantly, may by order defer or reduce employer and/or employee contributions for a period of up to three months at a time, across the whole of India or any part of it, in the event of a pandemic, endemic, or national disaster.
Voluntary additional contributions above the statutory wage ceiling are now expressly permitted under the Scheme. The employer is not obligated to match such voluntary contributions but may choose to do so, and additional administrative charges become payable on wages attracting voluntary contributions.
Contributions must be remitted within fifteen days of the close of every month. Employers are liable for damages on default, on a revised slab structure: 0.25 per cent per month of arrears where the default is less than two months, 0.50 per cent per month where the default extends beyond two months but remains under four months, and 1 per cent per month where the default exceeds four months.
Exemption and Governance of Exempted Establishments
Chapter IV substantially expands the governance framework for exempted establishments. Where exemption is granted, the employer must constitute a board of trustees under the employer's own chairmanship for management of the Provident Fund. The board is accountable to the Employees' Provident Fund Organisation for accounting of receipts, payments and balances, must meet at least once every three months, and is required to submit minutes of each meeting to the Regional Provident Fund Commissioner in Form III.
The composition of the board is prescribed in detail: not less than two and not more than six representatives each of employer and employees, with employee representatives nominated or elected through recognised trade unions following a specified procedure. A trustee's term runs for five years, and detailed disqualification and cessation criteria apply, including conviction for an offence involving moral turpitude, unsound mind, insolvency, or an employer's default in statutory dues.
Other notable governance requirements for exempted establishments include:
- Annual declaration of interest rate by the board, which cannot exceed 200 basis points above the rate declared by the Central Government for the year
- Mandatory electronic maintenance of accounts, online access for employees to check balances, and issuance of annual statements within two months of the close of the financial year
- Annual audit by a chartered accountant, with a rotation requirement preventing the same auditor from being appointed for more than two consecutive years, or more than two years in a block of six years
- Investment of trust funds strictly in dematerialised form, through SEBI-approved depository participants
- A written undertaking in Form IV at the time of grant of exemption, binding the employer and board of trustees to the conditions of exemption
- Transfer of inoperative and non-KYC account balances to the Employees' Provident Fund Organisation within a month
The order of exemption initially operates for three years, with applications for extension to be filed on the specified portal at least six months before expiry. Renewal is intended to be automatic where conditions continue to be satisfied and the establishment's net worth has not remained negative for three or more consecutive years. An establishment may not apply for exemption more than once on the same account within a period of ten years, and a subsequent application requires the establishment to demonstrate three years of continuous compliance preceding the request.
Establishments holding exemption under the repealed Employees' Provident Fund and Miscellaneous Provisions Act, 1952 are required to apply for continuation of exemption within two years from the date of notification of the Social Security (Central) Rules, 2026.
Transfers, Nominations and Withdrawals
Transfer of membership on change of employment is now fully portal-driven, with facilities for automated transfer subject to identity and ownership verification of the member's account.
Nomination rules have been tightened. Where a member has a family, the nomination must be in favour of one or more family members; a nomination in favour of a person outside the family is invalid. A fresh nomination becomes mandatory upon marriage, with any nomination made prior to marriage deemed invalid. Provision is made for appointment of a guardian where a nomination is wholly or partly in favour of a minor.
Partial withdrawal provisions under paragraph 46 have been substantially liberalised. Subject to maintaining a minimum balance equivalent to twenty-five per cent of the member's aggregate contributions, a member may withdraw up to one hundred per cent of the Eligible Member Balance, after twelve months of membership, for illness of self or family, education (up to ten times during membership), marriage (up to five times during membership), and housing-related needs such as purchase, construction, or renovation of a house or repayment of a home loan (up to five times during membership). A separate provision permits withdrawal for special circumstances, up to two times in a financial year.
Full withdrawal of the accumulated balance continues to be permitted on retirement after attaining fifty-five years of age, retirement due to permanent and total incapacity, migration from India for permanent settlement or employment abroad, retrenchment (individual or mass), and termination under a mutually agreed voluntary retirement scheme.
Responsibilities, Forms and Returns
Chapter VI consolidates employer and employee obligations, virtually all of which are now portal-based. Employers must file a consolidated return in Form V within fifteen days of the Scheme applying to the establishment (a Nil return where no employee is eligible), an ownership return in Form VI, authorisation of signatories in Form IX, monthly contribution details through the Electronic Challan-cum-Return in Form VII, and details of branches and controlling persons in Form VIII. Principal employers must declare all engaged contractors in Form X, with contractors reporting employee-wise wage and contribution details in Form XI, and principal employers consolidating recoveries in a monthly abstract in Form XII.
A late fee of five hundred rupees per day applies to delayed filing of returns, subject to a ceiling equal to the administrative charges payable for the relevant month. Separately, exempted establishments failing to file monthly and annual returns face an escalating fee structure of two hundred rupees per day, rising to five hundred rupees per day on repeated default, subject to a maximum of the inspection charges payable for that month.
New Forms Under the Scheme
The Scheme prescribes twelve forms (Form I to Form XII) in place of the forms under the 1952 Scheme, covering applications for exemption (Form I), electronic returns by exempted establishments (Form II), minutes of board of trustees meetings (Form III), the undertaking furnished at the time of grant of exemption (Form IV), consolidated returns (Form V), ownership returns (Form VI), the Electronic Challan-cum-Return (Form VII), branch and department details (Form VIII), authorised signatory details (Form IX), contractor declarations (Form X), contractor-wise employee returns (Form XI), and the principal employer's monthly abstract (Form XII).
Compliance Action Points
Establishments, particularly those operating exempted provident fund trusts, should treat this notification as a full reset rather than an update:
- Map every existing SOP, checklist and internal form reference built around the 1952 Scheme to the corresponding provision under the 2026 Scheme
- Review board of trustees composition, meeting frequency and Form III filing practice against the detailed governance conditions in Chapter IV
- Reassess interest declaration, audit rotation and investment practices for exempted trusts against the new conditions
- Update nomination records where existing nominations may now be invalid under the revised family-nomination rule
- Ensure portal-based filing readiness across Forms I to XII, given the Scheme's near-total shift to electronic compliance
This overview is based on a direct reading of the notification as published in the Gazette of India (Extraordinary), Part II, Section 3(i). Establishments should refer to the full text of the notification for the precise statutory language before acting on any of the above.
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