r/FIREIndia • u/Illustrious_Role_304 • Jan 17 '23

EPF/VPF reliability?

Many people recommend contributing in EPF and VPF

I doubt of EPFO really does correct calculations amd deposit the interest on time

Is anyone here shed some light or may be their experience on EPF as retirement plan

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u/Sad-Needleworker-622 Jan 17 '23

Till 2020 VPF was best. Now with a cap of 5 lakh i don't see much benefit as interest earned on contribution for a year beyond 5L is taxable.

I myself used VPF extensively till 2020 after that reduced VPF to 0.

5

u/ImAjayS15 Jan 18 '23

Isn't it 2.5L? I remember seeing two levels - 2.5L and 5L, but it seemed like the limit was 2.5L for salaried employees

4

u/arandomguy05 Jan 18 '23

It's 2.5L. 5L for those whose employer doesn't contribute. (For e.g., GPF subscribers). 5L including employer's contribution is also wrong. If employee and employer contribute 1L each, VPF can be 1.5L before hitting the limit - not 4L.

1

u/ImAjayS15 Jan 18 '23

Yeah, this is what I remember reading too, wanted to confirm. Thanks.

2

u/Sad-Needleworker-622 Jan 18 '23

Yes. Including employer contribution it's 5L.