Central Govt has enhanced the wage ceiling from Rs 15,000 to Rs 25,000 for covering employees under Provident Fund Coverage. So now all employees who receive salary (Basic+DA) upto Rs 25,000, now need to deduct PF @ 12%, which will be a maximum of upto Rs 3000. Employer’s contribution would also go up with an equal amount. The change has been brought by Notification No. SO 5109(E) dt 17-9-2026, effective from the same date.
Thus for employees whose, Basic + DA is above Rs 25,000, deduction would also be enhanced but would be limited to a maximum of Rs 25,000 limit of Basic + DA, i.e. @ Rs 3000/-.
To recap, effect after notification
- There is no change in contribution rate of 12%.
- But the now the maximum deduction and employer’s contribution will be of Rs. 3,000/- each, instead of maximum of Rs. 1,800/- earlier.
- There is no change in wages base, it is same Basic + DA
- Employees with eligible PF wages between Rs. 15,001 and Rs. 25,000 who are not currently PF members will be covered effective 17 Sept’ 2026.
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