Employees' Provident Fund Scheme 2026: Everything EPF Members Need to Know

For over seven decades, the Employees' Provident Funds Scheme, 1952 has governed how crores of salaried employees in India save for retirement. Now, the Central Government has notified the Employees' Provident Funds Scheme, 2026 under the Code on Social Security, 2020, replacing the 1952 Scheme with a modernised legal framework.

At first glance, the notification may appear to bring sweeping changes. However, for most EPF members, the transition is more evolutionary than revolutionary. The new Scheme largely carries forward the existing EPF framework while consolidating the rules governing membership, contributions, withdrawals, nominations, exempted establishments and fund administration under a single notification.

That doesn't mean nothing has changed. The Scheme introduces a clearer framework for partial withdrawals, strengthens governance and compliance provisions, recognises digital administration and gives the Central Government the authority to temporarily reduce or defer EPF contributions during emergencies such as a pandemic or national disaster.

For existing EPF members, the good news is that the core features of the provident fund system, including the Universal Account Number (UAN), monthly contributions, interest on EPF balances and account continuity,remain largely unchanged.

Here's everything EPF members should know about the Employees' Provident Funds Scheme, 2026.

What's new in the Employees' Provident Funds Scheme, 2026?

Although most core features of EPF remain unchanged, the Scheme introduces a few noteworthy developments.

• A new legal framework under the Code on Social Security, 2020.
• Greater use of digital records and online administration.
• A clearer framework for EPF withdrawals.
• Stronger governance and compliance requirements for exempted establishments.
• A provision allowing the Government to temporarily reduce or defer EPF contributions during emergencies.

Overall, the new Scheme focuses on modernising the EPF framework without changing how the Fund works for most members.

Do existing EPF members need to do anything?

No. If you are already an EPF member, you need not to open a new provident fund account or obtain a fresh Universal Account Number (UAN). Your existing EPF balance, contribution history and membership continue under the new Scheme. Similarly, employers do not need to migrate employees to a new system. The Employees' Provident Funds Scheme, 2026 primarily updates the legal framework governing EPF and aligns it with the Code on Social Security, 2020.

Investor takeaway - Existing EPF members can continue using their EPF accounts as before.

Has the EPF contribution changed?

Monthly EPF contributions have not changed. Both the employer and the employee will continue to contribute 12% of wages to the EPF. The reduced 10% contribution rate also continues for certain categories of establishments notified by the Central Government.

EPF contribution rates

What has changed?

One important addition is an emergency provision. The new Scheme authorises the Central Government to temporarily reduce or defer the employer's contribution, the employee's contribution or both for up to three months during a pandemic, epidemic or national disaster. A separate notification is to be sent in for such situations.

Investor takeaway: Your monthly EPF deduction does not change automatically. Any temporary reduction can happen only if the Government issues a separate notification.

How are EPF contributions calculated?

The way EPF contributions are calculated has not changed under the new Scheme.

Currently, the EPF wage ceiling is ₹15,000 per month. If an employee earns more than this amount, the mandatory EPF contribution is generally calculated only on ₹15,000, unless the employer and employee agree to contribute on higher wages.

The contribution is calculated on the wages earned during the month, regardless of whether the salary is paid daily, weekly, fortnightly or monthly. The final contribution amount is rounded off to the nearest rupee.

What has not changed?

The current EPF wage ceiling of ₹15,000 continues.

• Mandatory contributions are generally calculated only up to this limit.
• Contributions continue to be based on wages earned during the month.
• Contribution amounts continue to be rounded off to the nearest rupee.

Can employees contribute more than 12%?

Yes. The Employees' Provident Funds Scheme, 2026 continues the Voluntary Provident Fund (VPF) facility. Employees who wish to build a larger EPF corpus can voluntarily contribute more than the mandatory 12% of wages. These additional contributions are deposited through the Electronic Challan-cum-Return (ECR). While employers may also contribute more, they are not required to match the employee's additional contribution. Either the employee or the employer can also stop or reduce these voluntary contributions at any time.

VPF at a glance

What has changed?

There is no major change to the VPF facility. The Scheme largely continues the existing framework.

Who becomes an EPF member?

The Employees' Provident Funds Scheme, 2026 does not significantly change the rules on EPF membership. Employees who are eligible under the EPF law will continue to become members of the Fund. Existing members will also continue to remain covered, even if their salary later exceeds the prescribed EPF wage ceiling.

The Scheme also continues to specify who is eligible for EPF membership and who qualifies as an excluded employee.

What has changed?

There is no significant change in who can become an EPF member. The Scheme largely carries forward the existing eligibility rules while reorganising them under the new legal framework.

How is EPF interest credited?

The Employees' Provident Funds Scheme, 2026 does not make any major changes to the way EPF interest is credited.

EPF members will continue to earn interest at the rate notified by the Central Government each year. Interest is calculated on the balance available in the EPF account and is credited annually.

The Scheme also explains how interest is calculated in different situations: Existing balance: Interest is paid on the balance carried forward from the previous financial year.

• New contributions: Interest starts from the month after the contribution is credited to your EPF account.
• Withdrawals: Interest is paid only up to the month before you withdraw the money. In the case of retirement or death, interest is paid up to the date the final claim is settled.

The Scheme also states that interest will not be credited if an EPF account becomes inoperative or if a member has informed the EPFO in writing that they do not wish to receive interest.

What has changed?

No major change. The new Scheme largely retains the existing interest credit rules but explains them in a clearer and more organised manner.

Understanding the new EPF withdrawal framework

One of the biggest highlights of the Employees' Provident Funds Scheme, 2026 is its clearer framework for partial EPF withdrawals. Instead of having separate rules for different types of withdrawals, the new Scheme brings them together under a single framework. It clearly explains who can withdraw money, how much can be withdrawn, how often withdrawals are allowed and the conditions that apply. Members must apply through the designated portal, and the minimum amount that can be withdrawn is ₹1,000.

Another important change is the introduction of the Minimum Balance concept. This means members must keep a portion of their EPF savings in the account even after making a partial withdrawal, helping preserve their retirement corpus.

Two new terms every EPF member should know

Before understanding the new withdrawal rules, it's helpful to know these two terms:

1. Minimum Balance: Under the new Scheme, members must keep 25% of their EPF balance (including the employee's and employer's contributions and the interest earned on them) in their account after a partial withdrawal.

2. Eligible Member Balance: This is the amount you can actually withdraw. It is calculated after deducting the Minimum Balance that must remain in your EPF account. In other words, withdrawal limits are now based on the Eligible Member Balance, rather than your total EPF balance.

What's changed?

The introduction of the Minimum Balance and Eligible Member Balance is one of the key changes in the Employees' Provident Funds Scheme, 2026. These concepts did not exist under the earlier EPF Scheme, which prescribed different withdrawal limits for different purposes instead of a common withdrawal framework. Investor takeaway: The Scheme encourages members to use EPF savings when needed while ensuring that a portion of the retirement corpus continues to remain invested.

When can you make a partial withdrawal?

The Scheme allows members to withdraw money from their EPF account for specific purposes, subject to eligibility conditions. The Employees' Provident Funds Scheme, 2026 does not introduce entirely new reasons for withdrawing EPF savings. Members can still make partial withdrawals for purposes such as medical treatment, education, marriage and housing.

Partial withdrawal rules at a glance

What if you leave your job before completing 12 months?

The new Scheme also provides relief for employees who leave their job before completing 12 months of EPF membership. They may still be allowed to make a partial withdrawal. However, the amount they can withdraw cannot be more than their Eligible Member Balance.

How is the membership period calculated?

To decide whether a member is eligible for a partial withdrawal, the Scheme counts the total period of EPF membership. This includes Service with the same employer before the new Scheme came into force.

Membership under the EPF.

Membership in a recognised private provident fund of an exempted establishment. The period spent as an exempted employee before joining the EPF, provided the provident fund balance was not withdrawn. This means employees do not have to start counting their EPF membership from scratch when the new Scheme comes into effect.

How will the money be paid?

Once a partial withdrawal is approved, the amount can be credited directly to the member's bank account in a scheduled bank, a co-operative bank (including an urban co-operative bank) or a post office account, as chosen by the member.

When can you withdraw your entire EPF balance?

• Full withdrawal is permitted in situations such as,
• Retirement after attaining 55 years of age.
• Retirement because of permanent and total incapacity certified by the prescribed medical authority.
• Permanent migration outside India for settlement or employment.
• Termination of service because of retrenchment.
• Voluntary retirement under a mutually agreed retirement scheme.
• Certain unemployment-related situations after completing the prescribed waiting period. These provisions broadly continue the existing framework for final settlement while consolidating them under the new Scheme.

What has changed?

The biggest change is not the list of withdrawal purposes but the framework itself. The Scheme:

• Introduces the concepts of Minimum Balance and Eligible Member Balance.
• Creates a single framework governing all partial withdrawals.
• Requires applications to be made through the designated portal.
• Prescribes a minimum withdrawal amount of ₹1,000.
• Clearly specifies withdrawal limits, eligibility conditions and the number of times members can make withdrawals for different purposes.

What has not changed?

The broad objective of EPF withdrawals remains the same. Members can withdraw their provident fund savings for important life events such as medical emergencies, education, marriage and housing. Similarly, full withdrawal is also permitted on retirement and in other specified situation.

Why nomination rules matter

While most EPF members focus on contributions and withdrawals, nomination is equally important. A valid nomination ensures that the provident fund balance is paid to the rightful beneficiary if the member dies.

The Employees' Provident Funds Scheme, 2026 continues the existing framework for nominations while consolidating the provisions under the new Scheme. Members can make or update their nominations in the prescribed manner and the Scheme also lays down the rules governing payment of EPF accumulations after a member's death.

What has changed?

There is no major change to the nomination framework. However, the Scheme provides a more organised legal framework for nominations and the payment of benefits to nominees or legal heirs.

What has not changed?

Members can continue to nominate eligible beneficiaries. Nominations can be updated whenever circumstances change. In the event of the member's death, EPF benefits are payable according to the nomination or the applicable legal provisions. Investor takeaway: If you have not reviewed your EPF nomination after getting married or after the birth of a child, this is a good time to do so.

What if your employer has an exempted PF trust?

Not all EPF members contribute directly to the EPFO. Some large employers manage provident fund accounts through their own exempted PF trusts, which operate under EPFO supervision. The Employees' Provident Funds Scheme, 2026 introduces clearer rules for these trusts, including how they should manage accounts, investments, audits and reporting. It also specifies when an exemption can be cancelled if the prescribed conditions are not met.

For employees, however, nothing much changes. They will continue to receive provident fund benefits that are at least as favourable as those available under the EPF Scheme.

What has changed?

The new Scheme strengthens the rules and oversight for exempted PF trusts. However, it does not reduce or change the benefits available to employees covered by these trusts.

What has not changed?

Employees working in exempted establishments continue to receive provident fund benefits through their employer-managed trust, subject to the conditions prescribed under the Scheme.

Employees' Provident Funds Scheme, 2026: Biggest changes at a glance

What about EPFO 3.0?

The Employees' Provident Funds Scheme, 2026 and EPFO 3.0 are not the same. The new Scheme contains the legal rules governing EPF, while EPFO 3.0 is the EPFO's digital modernisation initiative. Features such as paperless services, faster claim processing and proposed UPI- or ATM-based withdrawals are being implemented separately and are not part of the new Scheme.

Frequently Asked Question

What is the Employees' Provident Funds Scheme, 2026?

The Employees' Provident Funds Scheme, 2026 is the new legal framework governing EPF membership, contributions, withdrawals, nominations and administration under the Code on Social Security, 2020.

Has the EPF contribution rate changed under the new Scheme?

No. The standard EPF contribution continues to be 12% of wages for both employers and employees. The reduced 10% contribution rate also continues for certain notified establishments.

What are the biggest changes in the Employees' Provident Funds Scheme, 2026?

The new Scheme introduces a clearer framework for EPF withdrawals, recognises digital administration, strengthens rules for exempted establishments and aligns the EPF framework with the Code on Social Security, 2020.

Has the EPF wage ceiling changed?

No. The current EPF wage ceiling of ₹15,000 per month remains unchanged under the Employees' Provident Funds Scheme, 2026.

What is the Minimum Balance under the new EPF Scheme?

The Scheme introduces the concept of a Minimum Balance, requiring members to keep 25% of the prescribed EPF balance in their account after a partial withdrawal.

Can employees still contribute more than 12% to EPF?

Yes. Employees can continue to make higher voluntary contributions through the Voluntary Provident Fund (VPF). However, employers are not required to match the additional contribution.

Has the EPF interest calculation changed?

No. The method of calculating and crediting EPF interest remains largely unchanged. The new Scheme mainly provides greater clarity on how interest is calculated in different situations.

Can I withdraw EPF before completing one year of service?

Yes, in certain cases. The new Scheme provides a framework for partial withdrawals even if a member leaves employment before completing 12 months, subject to the prescribed conditions.

Has my UAN changed under the new Scheme?

No. Existing Universal Account Numbers (UANs) continue to remain valid. The new Scheme does not require members to obtain a new UAN.

Is EPFO 3.0 the same as the Employees' Provident Funds Scheme, 2026?

No. The Employees' Provident Funds Scheme, 2026 contains the legal rules governing EPF, while EPFO 3.0 is the EPFO's digital modernisation initiative aimed at improving member services.

Do the new EPF withdrawal rules introduce new withdrawal purposes?

No. Members can continue to withdraw EPF for purposes such as medical treatment, education, marriage and housing. The new Scheme mainly reorganises and simplifies the withdrawal framework.

Do I need to do anything because of the Employees' Provident Funds Scheme, 2026?

For most EPF members, no immediate action is required. Existing EPF accounts, UANs and contribution rates remain unchanged, while the new Scheme mainly updates and consolidates the legal framework.