EPS (Employee Pension Scheme)

Employees' Pension Scheme (EPS) 1995, run by the EPFO, offers monthly pensions to employees after age 58. It is funded by 8.33% of the employer’s PF contribution, up to Rs.15,000 salary.
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Employee Pension Scheme
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4 mins
Aug 21, 2026

Retirement planning is essential for securing your financial future—and one of India's most trusted pillars in this journey is the Employees’ Pension Scheme (EPS) 1995. Launched by the Employees’ Provident Fund Organisation (EPFO) on 19 November 1995, EPS provides a structured, reliable monthly pension benefit to employees after retirement. Both employees and employers contribute 12% of the basic salary plus dearness allowance toward this pension scheme, ensuring consistent post-retirement income. Once an EPF member reaches the age of 58, they are eligible to claim their EPS pension—a system designed to offer long-term financial peace of mind


What is Employee Pension Scheme?

The Employees’ Pension Scheme (EPS) 1995 was launched by the Employees’ Provident Fund Organisation (EPFO) on 19th November 1995.


It helps employees receive a monthly pension after they retire. Once a member turns 58, they can claim their pension through the EPFO.


Both new and existing EPF members can benefit from EPS 95. Both the employee and employer contribute 12% of the employee's basic salary, and while EPS ensures a steady pension post-retirement, you can further add dearness allowance (DA) to the scheme to strengthen your financial future with a high-interest, risk-free investment option. 


The entire employee contribution goes to the EPF, while 8.33% of the employer's contribution is allocated to EPS, and the remaining 3.67% goes to the EPF.


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Responsibilities of employers

Employers have several key responsibilities regarding pension contributions under the Employees' Provident Fund (EPF) scheme:

  • Monthly contribution: Employers must contribute 8.33% of an employee's basic salary and dearness allowance to the Employees' Pension Fund within 15 days of the end of each month.
  • Government contribution: The Central Government also contributes 1.16% of an employee's pay to the Employees' Pension Fund.
  • Contractor employees: Employers are responsible for making contributions for all employees, including those working under contractors.
  • Disability benefits: If an employee becomes totally or permanently disabled during their service, the employer must contribute at least one month's basic EPS contribution to ensure eligibility for pension benefits.
  • Administrative costs: Employers are responsible for bearing all administrative costs associated with the EPF scheme.

 

Key Features of the EPS Scheme

Guaranteed Monthly Pension

The Employee Pension Scheme ensures a fixed monthly pension after retirement, typically starting at age 58. The amount depends on salary and years of service, providing a steady income stream and financial stability during post-retirement years.

Automatic Enrollment for EPF Members

If you are a member of the Employees’ Provident Fund (EPF), you are automatically enrolled in EPS. There is no separate registration required, making it a seamless addition to your retirement planning without extra effort.

Shared Contributions Towards Your Retirement

EPS is funded primarily through employer contributions, where 8.33% of the employer’s EPF share is allocated to the pension scheme, along with a small contribution from the government, ensuring a structured retirement fund.

Lifelong Security for You and Your Family

The scheme provides lifelong pension benefits to the employee and extends financial support to family members in case of death, including widow, children, and dependent benefits, ensuring long-term social security.


Benefits of Employee Pension Scheme

  • Superannuation Pension: Provided to members who retire at age 58 with a minimum of 10 years of eligible service. The pension is calculated using the formula: (Pensionable Salary × Pensionable Service) / 70.
  • Early Pension: Available to members retiring between ages 50 and 58 with at least 10 years of service. The pension amount is reduced by 4% for each year below 58.
  • Monthly Pension: Determined by the formula: (Pensionable Salary × Pensionable Service) / 70.
  • Minimum Pension: A guaranteed minimum of Rs. 1,000 per month, subject to deductions in cases of commutation or early retirement.
  • Widow Pension: The widow is entitled to receive 50% of the member's pension or Rs. 450 per month, whichever is higher.
  • Children Pension: Each eligible child receives 25% of the widow’s pension, up to a maximum of two children.
  • Orphan Pension: In the absence of a surviving spouse, each orphan can receive 75% of the widow’s pension, for up to two children.
  • Permanent Disability Pension: A minimum monthly pension of Rs. 250 is paid to members who suffer total and permanent disability during their service.
  • Withdrawal Benefit: Applicable to members who exit the scheme before completing 10 years of service. The benefit amount is determined as per the provisions of Table D.

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How to calculate your pension under EPS

The pension amount depends on member’s pensionable salary and service duration. Here is the formula for calculating monthly pension income:

Member’s Monthly Pension = (Pensionable salary x Pensionable service)/70

1. Pensionable salary

Pensionable salary is the average monthly salary earned during the last 60 months before a member exits the Employees’ Pension Scheme (EPS).

If there are any non-contributory periods (when no EPS contributions were made) during these 60 months, those days are excluded from the calculation. However, the benefits are still calculated as if the full salary was earned for the entire month.

For example: If someone joins a job on the 3rd of a month and earns Rs. 15,000 per month, their actual salary for 28 working days might be Rs. 14,000. But for EPS purposes, the full Rs. 15,000 would be considered as the pensionable salary for that month.

The maximum pensionable salary is capped at Rs. 15,000 per month.

Given that the employer contributes 8.33% of this salary to the employee’s EPS account, the monthly deposit in the employee’s EPS account is:

Rs. 15000 x 8.33/100 = Rs. 1250

2. Pensionable Service

The pensionable service is referred to actual period of service for the member. Service periods across different employers are considered when calculating the pensionable service period. The employee must obtain the EPS Scheme certificate and submit it to the new employer whenever they switch jobs.

If a member withdraws the EPS amount before completing 10 years and joins another company, they must restart contributing to the EPS account, and the service period will be reset to zero.

The pensionable service period is assessed on a 6-month basis, with a minimum of 6 months. For instance, if the service period is 7 years and 3 months, the considered pensionable service is 7 years. However, if the service duration is 7 years and 11 months, the pensionable service period is considered as 8 years.

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EPS Registration Process

Step 1: Activate UAN (Universal Account Number)

Visit the EPFO Unified Portal. Click “For Employees” and select “Member UAN/Online Services (OCS/OTCP)”. Enter your UAN, registered mobile number, and CAPTCHA code, then click “Request OTP”. Enter the OTP received on your mobile and click “Validate OTP”. You will be redirected to the UAN activation page to proceed further.


Step 2: Set password & complete KYC

Create a password between 8 to 12 characters that includes at least 1 uppercase letter, 1 number, and 1 special character. Go to “Manage” and select “KYC”. Upload your Aadhaar, PAN, and bank details. Once verified, the KYC status will appear as “Approved”, which usually takes 3 to 5 working days.


Eligibility criteria applicable for EPS

  • The applicant must be an active member of the Employees’ Provident Fund Scheme, 1952, or an establishment exempted under Section 17 of the EPF Act.
  • Monthly wages should not exceed Rs. 15,000, unless the employee contributes an additional 1.16% above this ceiling.
  • A minimum of 10 years of contributory service in the Employees’ Pension Fund is required.

Superannuation Pension

  • The applicant should have completed 58 years of age.
  • At least 10 years of eligible service must be rendered.

Early Pension

  • A minimum of 10 years of service is mandatory.
  • The applicant can opt for an early pension anytime between the ages of 50 and 58 years.

Family Pension

  • Applicable to the spouse or dependent children of a deceased EPS member who fulfilled the eligibility requirements.
  • Proof of relationship and the member’s death must be furnished.
  • The deceased member should have contributed for at least one month.

Post-Selection Requirements

  • Submission of all relevant documents for verification is necessary.

  • Pensioners must follow EPFO regulations for smooth disbursement of pension.


Note: International workers may also qualify under specific Social Security Agreements (SSAs) between India and other countries.


Additional read: Difference Between EPF and EPS


Contributions towards the EPS pension

EPS contributions are primarily funded through the employer’s share of EPF contributions. Employees do not make a separate contribution towards EPS under the standard arrangement.

  • Employee contribution: 12% of eligible wages goes towards EPF, with no separate EPS contribution.
  • Employer contribution: 12% is contributed, with 8.33% allocated towards EPS.
  • Central Government contribution: The Government contributes 1.16%, subject to the applicable wage ceiling.
  • Standard wage ceiling: EPS contribution is generally calculated on pensionable wages up to Rs. 15,000 per month.
  • Higher-wage cases: Eligible members may follow separate EPFO provisions for pension contributions on higher wages.

These contributions build the pension component separately from the EPF balance, supporting retirement income planning.


Documents Required

  • Proof of Identity – such as Aadhaar card, Passport, or Voter ID
  • Bank Details – including a cancelled cheque or a copy of the passbook
  • Date of Birth Verification – via a birth certificate or school leaving certificate
  • Death Certificate – required in case of claims for family pension
  • Proof of Relationship – necessary for family pension eligibility
  • Disability Certificate – issued by an EPFO-authorised medical practitioner, for disablement pension claims

  • Employment/Service Records – like the EPF passbook or official employment documents.


EPS withdrawal rules – Can you take your money out early?

EPS withdrawal depends mainly on your eligible service and age. Under current EPFO rules, members with less than 10 years of eligible service can generally claim withdrawal benefits. Members completing 10 years become eligible for pension benefits instead.


  • Less than 10 years: Withdrawal benefit may be claimed after leaving employment, subject to applicable EPS conditions.
  • 10 years or more: A Scheme Certificate or pension route applies, rather than withdrawal benefit.
  • Early pension: Eligible members can generally start reduced pension from age 50, while regular pension starts at 58.
  • Recent change: Since 2024, EPS withdrawal benefits consider completed months of contributory service, including service below six months.
  • Permanent disability: Monthly disablement pension can apply regardless of age or service period, subject to scheme conditions. 

How to calculate your EPS pension?

The EPFO formula for monthly EPS pension is (Pensionable salary × Pensionable service) ÷ 70.


Pensionable salary: Generally, the average monthly pay over the preceding 60 months, subject to applicable EPS limits.

Pensionable service: Eligible contributory service considered under EPS rules.

Formula example: With Rs. 15,000 pensionable salary and 25 years of service, pension is about Rs. 5,357 monthly.

Important: Members retiring at 58 after 20 years of pensionable service may receive an additional two-year weightage.


For a more precise estimate, EPFO also provides an official pension calculator, whose result is indicative.


Types of pensions in the Employees’ Pension Scheme

The EPS 95 pension scheme offers various pensions, including those for widows, children, and orphans, providing support to the deceased member's family.

1. Child pension

Surviving children receive a child pension, in addition to the monthly widow pension, until they turn 25. The amount is 25% of the widow pension, and a maximum of two children can receive this benefit.

2. Widow pension

Widows are eligible for a pension under the Widow or Vridha pension, which continues until their death or remarriage. If there are more than one widow, the pension is payable to the eldest widow.

3. Reduced pension

If an EPFO member completes 10 years of service and is between 50 and 58 years old, they can opt for early pension. However, If the member is below 58 years of age, the pension amount is reduced by 4% for every year.

4. Orphan pension

If the member passes away without a surviving widow, the member's children can receive a monthly orphan pension, which is 75% of the monthly widow pension value. Up to 2 children can benefit from the orphan pension.

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Types of pensions forms under EPS in India

Form/CertificatePurpose
Form 10CUsed to withdraw EPS funds before completing 10 years of service.
Form 10DUsed to claim monthly pension after the age of 50, including widow pension, child pension, etc.
Non-Remarriage CertificateDeclares that the widow or widower has not remarried, required for continuing pension benefits.

Also read: National Pension Scheme


Types of pensions forms under EPS in India

  • Superannuation and early pension

    Members receive a monthly pension after retirement at 58 years or can opt for early pension from 50 years at reduced rates, ensuring flexibility in retirement planning. 

  • Disablement pension

    Provided to members who become permanently disabled during service, this pension ensures financial support regardless of service duration, offering security during unforeseen circumstances. 

  • Family, widow, and child pension

    In case of a member’s death, pensions are extended to the spouse and children, ensuring continued financial support for dependents and maintaining household stability. 

  • Orphan and nominee pension

    If both parents pass away, children receive orphan pension, while nominee pension is given when no direct family members are present, ensuring no beneficiary is left unsupported.


Conclusion

The Employee Pension Scheme (EPS) provides guaranteed monthly income after retirement to employees in the organised sector. The pension amount depends on their years of service and contributions. Knowing the eligibility criteria and different types of pensions under EPS can help employees make informed decisions for a secure future.


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Frequently asked questions

Can I withdraw my EPS amount?

Yes, you can withdraw your EPS amount if you have completed 10 years of service or if you are retiring at the age of 58. Partial withdrawal is also possible under certain conditions, such as unemployment.

Can I receive both EPS pension and returns from a Fixed Deposit simultaneously?

Yes, you can receive your EPS pension while earning returns from a Fixed Deposit. While EPS provides a steady post-retirement income, investing in a high-interest FD can help you supplement your pension and ensure greater financial security. With Bajaj Finance FD, you can earn returns of up to 7.75% p.a., ensuring stable and risk-free growth for your savings. Book your FD today to build a stronger financial future!

Is EPS mandatory for all employees?

Yes, EPS is mandatory for all employees who are part of the Employees' Provident Fund (EPF) scheme and earn a monthly salary of up to ₹15,000. It provides pension benefits after retirement.

Who is eligible for the EPS scheme?

Employees who are members of the Employees’ Provident Fund (EPF) and have completed at least 10 years of service are eligible for the Employees’ Pension Scheme (EPS). The scheme is available to employees earning a basic salary of up to Rs. 15,000 per month and provides a pension after retirement at the age of 58 years.

Who is not eligible for EPS pension?

Employees who haven't completed 10 years of service or are currently employed are ineligible to withdraw EPS funds. You can only withdraw once you've left your current job.

How much EPS pension will I get?

The EPS pension amount depends on your last drawn salary, years of service, and the contribution made to the Employee Pension Scheme (EPS). The formula used is (Pensionable Salary × Service Years) / 70, with a minimum monthly pension of ₹1,000.

What is EPS 95 pension scheme?

The EPS 95 pension scheme, introduced in 1995, is a social security initiative under the EPFO that provides a monthly pension to eligible employees after retirement, disability, or death. It ensures financial stability for employees with a minimum service of 10 years.

What is EPS limit?

The EPS limit refers to the maximum pensionable salary considered for contributions. As per current rules, the salary cap is Rs. 15,000 per month, meaning contributions are calculated based on this limit, regardless of the actual salary earned by the employee.

Is EPS the same as NPS?

No, EPS (Employee Pension Scheme) and NPS (National Pension System) are different. EPS is for salaried employees under EPF and offers a fixed pension post-retirement. The employer contributes, and employees can check balances via the EPFO portal. NPS, on the other hand, is voluntary, open to all Indian citizens, and offers market-linked returns. Contributors can view their balance on the NPS portal. Each scheme serves different retirement planning needs.

How do I check my EPS balance?

To check your Employee Pension Scheme (EPS) balance, visit the official EPFO website and log in using your Universal Account Number (UAN) and password. Go to the “Member Passbook” or “Pension Passbook” section to view your EPS balance and contribution details. This helps you keep track of your pension savings easily and securely.

What is EPS in my salary slip?

EPS in your salary slip refers to the Employees’ Pension Scheme, a retirement benefit under EPF. Out of the employer’s 12% EPF contribution, 8.33% is diverted to EPS (subject to a wage ceiling). This amount helps build a monthly pension payable after retirement, disability, or to nominees.

How much EPS pension will I get?

Your EPS pension depends on your pensionable salary and years of service. It is calculated using the formula: (Pensionable salary × Pensionable service) ÷ 70. With the current wage ceiling, the maximum pension is modest, and longer service leads to a higher monthly payout.

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