Private provident fund trusts have been directed by the Employees’ Provident Fund Organisation (EPFO) to declare interest at par or more than the EPFO, and if there is any deficiency in the interest declared, that should be made good by the employer maintaining such trusts. Also, 100 points will be given if the trust has declared interest at par or more than the EPFO and for declaration of less interest, points will be deducted proportionately.
This was communicated by the EPFO to the employers maintaining private provident fund trusts, recently. The PF office had to issue compliance guidelines for such employers as it noticed that more than 700 employers maintaining private provident fund trusts have not filed the online return for the month of July 2017.
To boost compliance, the EPFO has also devised a mechanism to allocate points to such employers on the basis of six compliance parameters. Based on the points (100 points each) allocated, a rank list will be prepared and published on the website of the EPFO every month.
As per a Tax Alert by EY, the EPFO recently issued a circular providing compliance guidelines for employers maintaining private provident fund trusts. The PF offices have been directed to issue show cause notices to all the defaulting employers and trusts that have not filed the online returns on or before 05 October 2017. EPFO has also asked the trusts to put in place a mechanism to communicate with the employees through text messages on mobile phone, email or mobile epassbook about the receipt of contribution in their account every month within 2 days of receipt of remittance from the employer.
Also, any non-compliance by the employers and private provident fund trusts may lead to various penalties, surcharge and other consequences laid down in the provident fund law. Non-compliance may also lead to cancellation of exemption / relaxation granted to the employer.