Delayed EPFO payment not to attract penalty

By: |
Updated: May 16, 2020 11:43 AM

Depending on the duration, delayed payment now attracts penalty of between 5% and 25% on the shortfall of payment of dues.

EPFO payment, delayed EPFO payment,EPFO money, Employees Provident Fund, EPFO penalty,EPFO news, latest news on EPFO Central provident fund commissioner Sunil Barthwal said, “As of now, the penalty reprieve is for three wage months – March, April and May. However, the interest part will remain. Interest is levied at just 1% per month,” he said.

In a relief to establishments registered with Employees’ Provident Fund Organisation (EPFO) but not qualified for benefits under Pradhan Mantri Garib Kalyan Yojana (PMGKY), the government on Friday said their deferred remittances of statutory contributions towards EPF for three months starting March will not attract penalty.

Depending on the duration, delayed payment now attracts penalty of between 5% and 25% on the shortfall of payment of dues. However, the delay also attracts interest at the rate of 12% per annum, which will continue to attract in case of delayed payment. Including interest and penal damages, the EPFO had collected Rs 52.40 crore in 2017-18 from employers.

In an official statement on Friday, the government said due to prolonged lockdown to control the spread of Covid-19 and other disruptions due to the pandemic, establishments covered under EPF & MP Act, 1952 are distressed and unable to function normally and pay the statutory contributions on time.

Considering the difficulty faced by establishments in timely deposit of contributions or administrative charges due for any period during lockdown, the EPFO has decided that such delays due to operational or economic reasons shall not be treated as default and penal damages should not be levied for such delay,” the statement said.

Central provident fund commissioner Sunil Barthwal said, “As of now, the penalty reprieve is for three wage months – March, April and May. However, the interest part will remain. Interest is levied at just 1% per month,” he said.

Considering the difficulty being faced by employers, the government had earlier separated submission of monthly electronic challan-cum-return (ECR) from depositing of the statutory dues. The intention was to provide liquidity in the hands of the employers. However, establishments are required to continue filing ECR within due date – the first 15 days of the next month.

The relaxation shall ease compliance norms for 6.5 lakhs EPF-covered establishments and save them from liability on account of penal damages, the statement said.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Mutual Funds: Now assess risks with revamped risk-o-meter
2Kotak Life launches Kotak Health Shield, forays into comprehensive health insurance segment
3Karnataka govt gives nod to switch implementing agency for Bhagyalakshmi scheme