Savings
EPF Interest Rate, Contributions and Withdrawal Rules
Contributions and the EPS split, how interest is calculated, a growth example, and the simplified 2026 withdrawal and tax rules.
By Team Vind · Updated · 6 min read
If you work for a company with 20 or more employees, a slice of every salary goes into the Employees' Provident Fund (EPF). It's quietly one of the best savings you have: guaranteed, largely tax-free, and currently earning 8.25% (FY 2025-26). Here's how the money goes in, how interest is worked out, and when you can take it out.
Who puts in what
Both you and your employer contribute 12% of your basic pay plus dearness allowance (DA) every month. But the employer's share is split:
| Contribution | Rate | On ₹50,000 basic + DA |
|---|---|---|
| Your share → EPF | 12% | ₹6,000 |
| Employer → pension (EPS) | 8.33%, capped at ₹2,083 | ₹2,083 |
| Employer → EPF | The rest of 12% | ₹3,918 |
| Into your EPF each month | ₹9,918 |
How EPF interest is calculated
Monthly interest = running balance × 8.25% ÷ 12 · credited once a year
EPFO works out interest on your balance at the end of each month and adds the year's total to your account after the financial year ends. The rate is declared every year by EPFO's board: 8.25% for FY 2025-26.
Try it: EPF Calculator
Your EPF at Retirement
- Current balance₹2,00,000(1%)
- Contributions₹71,94,718(34%)
- Interest₹1,37,39,454(65%)
Year by year
| Age | Contributions | Interest | Balance |
|---|---|---|---|
| 31 | ₹90,210 | ₹20,531 | ₹3,10,741 |
| 32 | ₹97,122 | ₹29,976 | ₹4,37,840 |
| 33 | ₹1,04,449 | ₹40,789 | ₹5,83,078 |
| 34 | ₹1,12,215 | ₹53,119 | ₹7,48,411 |
| 35 | ₹1,20,447 | ₹67,126 | ₹9,35,985 |
| 36 | ₹1,29,174 | ₹82,991 | ₹11,48,150 |
| 37 | ₹1,38,423 | ₹1,00,908 | ₹13,87,481 |
| 38 | ₹1,48,228 | ₹1,21,091 | ₹16,56,801 |
| 39 | ₹1,58,621 | ₹1,43,774 | ₹19,59,196 |
| 40 | ₹1,69,638 | ₹1,69,214 | ₹22,98,049 |
What it can grow to
Start at 25 with ₹50,000 basic + DA, get 6% raises each year, and keep contributing to 58. At 8.25%:
| Age | EPF balance |
|---|---|
| 35 | ₹24,15,884 (24.16 lakh) |
| 45 | ₹99,66,863 (99.67 lakh) |
| 58 | ₹4,17,22,745 (4.17 crore) |
When can you withdraw?
The EPF Scheme 2026, in force from 1 July 2026, simplified the rules:
- Retirement: the full balance at 58.
- Losing your job: up to 75% straight away, and the rest after 12 months without work.
- Partial withdrawals are grouped into three kinds: essential needs (illness, education, marriage), housing, and special circumstances. All need just 12 months of service, and at least 25% of your balance must stay in the account, still earning interest.
- Changing jobs: don't withdraw. Your UAN stays the same, and the balance moves to the new employer, usually automatically.
Want to save more?
The Voluntary Provident Fund (VPF) lets you put in more than 12%, up to 100% of basic + DA, at the same interest rate. Your employer doesn't match it. For more on how PF affects your monthly pay, see CTC vs in-hand salary.
Frequently asked questions
What is the EPF interest rate for 2025-26?
8.25%, declared by EPFO and approved by the government.
Can I withdraw my full PF after leaving a job?
Up to 75% immediately and the remaining 25% after 12 months without employment. If you join a new job, transfer the balance instead.
Is EPF interest taxable?
Interest on your contributions above ₹2.5 lakh a year is taxable. Below that, it's tax-free.
How do I check my EPF balance?
On the EPFO member passbook portal or the UMANG app with your UAN, by a missed call to 9966044425, or by SMS to 7738299899 from your registered mobile.
These results are estimates for planning only, not financial, investment or tax advice. Rates and rules change, and your bank, fund house or employer may calculate slightly differently. Check with them or a qualified adviser before you decide.
Sources
- EPFO: interest rate and member services
- EPFO: Employees' Provident Funds Scheme, 2026 (partial withdrawal rules)
- Ministry of Labour and Employment: wage ceiling notification S.O. 5109(E), 2026
Last reviewed: 10 October 2026