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Confused Employer: Can I Contribute an Ex-PF Employee's Share to His NPS?

Milind

Milind Vadjikar  |1056 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Feb 20, 2025

Milind Vadjikar is an independent MF distributor registered with Association of Mutual Funds in India (AMFI) and a retirement financial planning advisor registered with Pension Fund Regulatory and Development Authority (PFRDA).
He has a mechanical engineering degree from Government Engineering College, Sambhajinagar, and an MBA in international business from the Symbiosis Institute of Business Management, Pune.
With over 16 years of experience in stock investments, and over six year experience in investment guidance and support, he believes that balanced asset allocation and goal-focused disciplined investing is the key to achieving investor goals.... more
Aswathy Question by Aswathy on Feb 18, 2025Hindi
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We are a private limited company covered under PF regulations. A newly joined employee mentioned that he is not a PF member and wishes to continue that way. Instead of contributing to PF, he has requested that the employer’s PF portion (₹1,800/month) be allocated to his NPS account for tax benefits. Is this legally permissible? If so, what would be the correct procedure to implement this? Looking forward to your insights! Thank you in advance!

Ans: Hello;

Legally it should be possible but for an organisation to allow employees this flexibility (either to join NPS or EPF) should be based on compliance requirements of EPFO law and other labour laws in this regard.

In the quest to the offer flexibility to the employees the employer shouldn't get entangled in legal issues.

Best wishes;
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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