The Employees’ Provident Fund Organisation (EPFO) Monday extended the deadline to opt for a higher pension to May 3. “The joint option for employees who were in service prior to September 1, 2014

This comes after the EPFO on February 20 released a set of instructions to its zonal offices to allow a section of its older members to opt for higher pensions under the Employees’ Pension Scheme (EPS).

At present, an employee’s contribution towards the EPF account is capped at 12% of the Basic Pay+Dearness Allowance. An equal 12% contribution is made by the employer, of which 8.33% goes towards EPS and 3.67% towards the employee’s EPF account.

The employer’s 8.33% contribution is subject to the statutory wage ceiling of Rs 15,000, which means only Rs 1250 (8.33% of Rs 15,000) goes to your EPS account every month.

The apex court in its ruling allowed a four-month window to enable opting for higher pensions for EPS subscribers, the deadline of which came to around March 3, 2023.

The EPS provides employees with a pension after the age of 58, if they have rendered at least 10 years of service and retired at age 58. If a member leaves employment between ages 50 and 57, they can avail early (reduced) pension.

Members, who opted for pensions linked to actual salaries exceeding the wage ceiling, were required to contribute an additional 1.16 per cent of their salary toward the pension fund.

Under the pre-amendment scheme, the pensionable salary was computed as the average of the salary drawn during the 12 months prior to exit from membership of the pension fund. The 2014 amendments raised this to an average of 60 months prior to exit.