EPFO and ESIC Registration

Last Updated On: July 21, 2020, 1:04 p.m.
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EPFO AND ESIC- REGISTRATION

The Employee Provident Funds and Miscellaneous provision Act. This Act provides for the institution of provident funds, Pension fund, and deposit and linked insurance fund for employees in factories and other establishments.

Eligibility criteria for EPF Registration:

Section 1(3) of the above act defines the eligibility criteria for EPF Registration

  • Establishment which is a factory engaged in any industry having 20 and more persons,
  • To any establishment employing 20 or more persons of such establishment which the Central Government may, by notification specify in this behalf,
  • An employee whose pay does not exceed more than Rs.15000

 

Benefits of registering under EPF Scheme:

  • An amount of deposit made in the provident fund will make you eligible for tax exemption under Section 80 of Income Tax Act, 1961.
  • You can partially withdraw from the deposit made in the provident fund for specific expenses such as House Construction, marriage, Higher Education, Illness, etc.
  • Accumulation plus interest upon retirement, resignation, and death.

 

EPF Contribution rates:

12/10% of the Employee share will be contributed as Employee Provident Fund.

10% rate is applicable for:

  • Any Establishment in which less than 20 employees are employed.
  • Any sick industrial company and which has been declared as such by the Board for Industrial and Financial.
  • Any establishment has accumulated losses equal to or exceeding its entire net worth at the end of the financial year.

NOTE:

  • The Contributions are payable on maximum wage ceiling of Rs.15000
  • The wage ceiling of Rs.15000 is not applicable to an international worker.

 

THE EMPLOYEES STATE INSURANCE ACT,1948:

  • ESI Act provides benefits to employees in case of sickness, maternity and employment injury and to make provision for other matters in relation.
  • The wage limit for coverage under the Act effective from 1/1/2017 is Rs.21000 per month (Rs. 25000 per month in case of persons with disability).
  • Under Section 1(5) of the Act, the Scheme has been extended to shops, hotels, restaurants, cinemas including preview theatres, road-motor transport undertakings, newspaper establishments, establishments engaged in Insurance Business, Non-Banking Financial Companies, Port Trust, Airport Authorities and Warehousing establishments employing 10 or more persons.
  • Further, under Section 1(5) of the Act, the Scheme has been extended to Private Medical Institutions, Educational institutions and to contract and casual employees of Municipal Corporation/Municipal Bodies employing 10* or more persons in certain States/UTs.

NOTE: However the threshold for Coverage of establishments is still 20 Employees in Maharashtra and Chandigarh.

 

BENEFITS OF REGISTERING UNDER ESIC SCHEME:

1. Full medical care is provided to an Insured person and his family members from the day he enters insurable employment.

2. Sickness Benefit in the form of cash compensation at the rate of 70% of wages is payable.

3. Maternity Benefit for pregnancy is payable for Twenty Six weeks.

4. If the death of the employee happens while on work – 90% of the salary is given to his dependents every month after the death of the employee

5. Funeral expenses and Old age care medical expenses.

6. Expenses in case of disability of the employee.

 

ESIC Contribution Rates:

Particulars Current Rate
Employer Share 3.25% of the wages
Employee Share 0.75% of the wages
Total 4%

 

NOTE: Employees in receipt of a daily average wage up to Rs.137/- are exempted from payment of contribution This is because Employers will however contribute their own share in respect of these employees.

KEY POINTS TO REMEMBER:

  • Registration for EPFO and ESIC for new Public Limited Company, Private Limited Company and One person company has been stopped on Shram Suvidha Portal from 15.02.2020.
  • Registration is only available on the MCA portal i.e www.mca.gov.in through SPICE+ and Agile Pro e-forms at the time of incorporation.

 

Shram Suvidha Portal is an ‘Ease of Doing Business’ Labour Law Reform initiative by the Ministry of Labour & Employment, Government of India. It was launched on 16 October 2014 with a facility to get all kinds of registrations and submit returns in the context of labour laws at a single online window.

Before that Registration of PF and ESIC used to happen on their particular website only.

You can take a common registration for both PF and ESIC at unified Shram Suvidha Portal.

1. Firstly, you must create an account in the name of the applicant on the portal.

2. Then click the tab ‘Under EPF-ESIC Registration’ which is given on the right side.

3. An application for registration will appear, fill all necessary details, and submit the application.

4. DSC or E-Signing is required for Final submission.

5. You’ll get a registration mail along with your Login Credentials on your registered Mail-ID.

 

DOCUMENTS REQUIRED FOR REGISTRATION (EPFO AND ESIC):

No physical documents and physical visits are required for submitting documents to register. All documents to be uploaded online only at the time of filing application for registration

The required documents as follows:

1. Copy of registration certificate or licenses in the name of the company.

2. PAN Card of the Business Entity as well as all the Employees working under the entity.

3. Number of Employees and their details

4. Primary Business Type of entity.

5. A Specimen of Signature.

6. Digital Signature.

7. Scanned copy of a cancelled cheque

8. Proof of Address of business entity.

9. Setup Proof

10. License Proof

11. Lease deed if Hired/Rented/leased

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