- The Employees’ Pension Scheme, 2026 was notified on 29 June 2026 and replaced the 1995 scheme.
- Your employee pays nothing into EPS, and the Central Government adds 1.16%.
- The minimum pension is ₹1,000 a month.
- Members with 20 or more years of pensionable service get two years’ weightage.
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How is the EPS pension calculated?
The formula is pensionable wages multiplied by pensionable service, divided by 70.
Pensionable wages are the average monthly wages over the 60 months before membership ends, subject to the wage ceiling, so a ceiling rise takes five years to flow fully into the average. The uplift arrives slowly.
| Pensionable wages | Service | Monthly pension |
|---|---|---|
| ₹15,000 | 14 years | ₹3,000 |
| ₹15,000 | 10 years | ₹2,143 |
| ₹25,000 | 14 years | ₹5,000 |
| ₹6,500 | 10 years | ₹1,000 (floor applies, formula gives ₹929) |
Let’s say your Pune analyst retires at 58 with 14 years of service, and every one of their last 60 months ran on the old ₹15,000 ceiling. The pension is ₹3,000 a month. The same career on the new ceiling yields ₹5,000. That gap is real money.
The CMS IndusLaw note on the 2026 schemes sets out the formula and the ₹1,000 floor.
What did the ₹25,000 ceiling change for EPS?
Your eps contribution went up from ₹1,250 to ₹2,083 a month for anyone at or above the ceiling. Your total stays at 12%. For staff who contribute on full salary, ₹833 more of that 12% now goes to pension each month and less to Employees’ Provident Fund savings.
A second change is easy to miss. Some EPF members were kept out of EPS because they joined above the old ₹15,000 limit. Those earning below ₹25,000 had to be enrolled from 17 September 2026.
The employer does this. No member application is needed, according to KPMG’s summary of the EPFO FAQs.
Higher pensions remain possible. Where an employee holds a joint option to contribute on wages above the ceiling, you pay 9.49% to EPS instead of 8.33%. Foreign staff follow separate international worker rules.
How does Remunance manage EPS for your India employees?
Remunance runs the 8.33% split inside every monthly ECR, flags staff who need EPS enrolment and keeps service records clean under each employee’s UAN. We do this today for 1,200+ Indian employees across 34 cities.
If you already employ in India through your own entity, our compliance management service can audit your September 2026 EPS enrolments and fix any missed months. Book a free PF compliance check before the next ECR is due.
What else do people ask about EPS?
Does the employee contribute to EPS?
Never. EPS is funded by 8.33% of the employer’s share plus a 1.16% Central Government contribution. The employee’s full 12% goes to EPF.
What is the minimum EPS pension?
It is ₹1,000 a month. That floor carries into the 2026 scheme unchanged since 1 September 2014, and it applies whenever the formula produces less.
Can I get an EPS pension before 10 years of service?
Not as a monthly pension, because the 2026 scheme sets 10 years’ service as the qualifying condition. The member’s EPFO service history stays tied to one permanent UAN across jobs. Our guide to payroll compliance in India explains how EPS sits within monthly filings.
Planning a hire in India?
Our founding team has run payroll and hiring in India for 22+ years, first as Remunance Systems, which was later acquired by ADP.