What is Provident Fund and ESI ?
Provident fund is a savings scheme for the benefit of the employees run by the government. Employees Provident Fund Organisation (EPFO) is a governmental body which maintains and oversees the fund. Contribution to PF is mandatory for every employee, employers also contributes equally to the provident fund. Amount accumulated in the fund can be withdrawn at the time of retirement along with interest.
ESI Scheme is a comprehensive Social Security Scheme designed to accomplish the task of socially protecting the ’employees’ in the organized sector against the events of sickness, maternity, disablement and death due to employment injury and to provide medical care to the insured employees and their families.
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Organisations employing 20 or more members are required to register with PF department. Strength of 20 includes contract employees. Companies can also register themselves voluntarily. Employers are required to register with PF department within one month from the date of reaching 20 employees.
Contribution
The ESI Scheme is mainly financed by contributions raised from employees covered under the scheme and their employers, as a fixed percentage of wages. The rates of contribution are:
| A | Employees’ Contribution | 1.75% of Total Wages |
| B | Employers’ Contribution | 4.75% of Total Wages |
In a situation where all employees are drawing above Rs. 15,000/-, you still need registration, we file a letter that there are no employees who draw a gross salary lesser than Rs. 15,000 per month and therefore no contribution, filing of returns etc. is still required. Therefore ESI registration is purely from a compliance perspective.
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What are the Documents required for ESI/PF Registration?
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Knowledge PortalFAQs
Why should an employer register his/her establishment on the EPFO Employer portal?
Remittance by the employer has to be done only after generating challan from the EPFO. Hence, it is mandatory for every employer to register in the EPFO portal.
What are the consequences for non registration?
The online generation of challan will not be possible if the employer has not registered his/her establishment. The employer has to register and create his/her user id & password for accessing the Employer Portal of EPFO.
What are the compliance requirements for an employer?
Every employer has to generate challan and pay the amount due by 15th of every month. Also, employers are required to file PF returns.
What is ESI code?
Registration is the process by which every employer/factory and its every employee employed for wages, is identified for the purpose of the Scheme, and their individual records are set up for them. EMPLOYERS CAN NOW SUBMIT APPLICATION ONLINE FOR REGISTRATION UNDER ESI ACT THROUGH.
Which PAN is required for registration?
The PAN issued by the Income Tax of India in the name of the establishment is to be entered.
What is the due date for PF returns?
Due date for monthly PF return is 25th of every month and due date for annual PF return is 25th April.
What is registration of Factory/ Establishment?
Registration is the process, by which every factory/ establishment, to which the Act applies, is identified for the purpose of the ESI Scheme, and their individual records are set up for them.
9. Is it mandatory for the Employer to register under the scheme?
Yes, it is the statutory responsibility of the employer under Section 2 –A of the Act read with Regulation 10-B, to register their Factory/ Establishment under the ESI Act within 15 days from the date of its applicability to them.
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