Introduction
Employees Provident Fund (EPF) is an important part of an employee’s retirement savings. It is a long-term savings plan that helps employees save for their retirement. The Employees’ Deposit Linked Insurance (EDLI) scheme is a part of the EPF scheme that provides life insurance coverage to EPF members. The EDLI scheme provides a lump sum payment to the nominee of the EPF member in the event of the member’s death. Calculating the EDLI amount is an important part of the EPF process. In this article, we will discuss how to do PF EDLI calculation in 2021. We will discuss the eligibility criteria, the calculation formula, and the documents required for the calculation. We will also discuss the benefits of the EDLI scheme and how to make a claim.
How to Do PF EDLI Calculation in 2021
1. Calculate the Employee’s Basic Pay: The first step in calculating the PF EDLI calculation is to calculate the employee’s basic pay. This is the amount of salary that the employee earns before any deductions are made.
2. Calculate the Employee’s PF Contribution: The next step is to calculate the employee’s PF contribution. This is the amount of money that the employee contributes to the Employees’ Provident Fund (EPF).
3. Calculate the Employer’s PF Contribution: The employer also contributes to the EPF. This amount is calculated as a percentage of the employee’s basic pay.
4. Calculate the EDLI Contribution: The EDLI contribution is calculated as a percentage of the employee’s basic pay and the employer’s PF contribution.
5. Calculate the Total PF EDLI Contribution: The total PF EDLI contribution is the sum of the employee’s PF contribution, the employer’s PF contribution, and the EDLI contribution. This amount is then deducted from the employee’s salary.
EDLI will be calculated at a rate of 0.5% on total PF wages of the employees i.e basic wage + Dearness allowances. EDLI contributions will be present A/C no 21 of PF challan.
EDLI means Employee Deposit Linked Insurance. Employees who are covering under the employee provident fund scheme will also cover under the employee deposit insurance scheme 1976. Under the EDLI scheme, the beneficiaries or nominees of the beneficiaries will get insurance benefits during the death or illness of EPF members.
How to Calculate EDLI Contribution of Employees
EDLI Contribution Formula = (Basic salary of employee +DA) X 0.5%
For example, if an employee basic wage + DA i.e PF wage is 14000 Rs then EDLI contribution is calculated as follows
EDLI contribution of employee = 14000 X 0.5% = 7 Rs
Employers will calculate the EDLI contributions of employees on the total sum of PF wages of all the employees who are covering under the EPF scheme.
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How to Do PF EDLI Calculation in 2021
Employees’ Deposit Linked Insurance (EDLI) is a scheme introduced by the Employees’ Provident Fund Organisation (EPFO) to provide life insurance coverage to members of the Employees’ Provident Fund (EPF). The EDLI scheme provides a lump sum payment to the nominee of the deceased EPF member in the event of his/her death. The amount of the lump sum payment is calculated based on the employee’s salary and the number of years of service. In 2021, the EDLI calculation is done using the following formula:
EDLI Calculation = (Basic Salary + DA) x 0.5% x Number of Years of Service
For example, if an employee’s basic salary is Rs. 10,000 and he/she has been working for 5 years, then the EDLI calculation will be:
EDLI Calculation = (10,000 + 0) x 0.5% x 5 = Rs. 250
The EDLI amount is paid to the nominee of the deceased EPF member in the event of his/her death. The EDLI amount is paid in addition to the EPF balance that the deceased member had accumulated over the years. The EDLI amount is paid within 30 days of the death of the EPF member.
It is important to note that the EDLI calculation is done on the basis of the last salary drawn by the EPF member. Therefore, it is important to ensure that the salary details of the EPF member are updated regularly to ensure that the EDLI calculation is done accurately.
The EDLI scheme is a great way to provide financial security to the family of the deceased EPF member. It is important to ensure that the EDLI calculation is done accurately to ensure that the nominee of the deceased EPF member receives the correct amount.
