Saturday, January 28, 2023

GPF New Rule: Good news for government employees! Rules for GPF have changed; you should be aware

GPF New Rule: A significant adjustment has been made to the General Provident Fund guidelines (GPF). Only up to Rs 5 lakh can now be invested in GPF per financial year, under the new guidelines. Earlier to that, there was no set max investment amount. Inform me of any latest updates.

The news is important for government employees. The General Provident Fund’s regulations have been altered by the government (GPF). Employees would only be permitted to contribute up to Rs 5 lakh to GPF each financial year under the new guideline. Let us inform you that GPF is a PPF-like programme to which only government employees are permitted to make contributions.

The government changed the GPF rules.

It’s important to note that, following the General Provident Fund (Central Service) Rules, 1960, there has never been an upper limit set for contributions to this fund. That is, up to this point, employees were allowed to contribute a portion of their wages. However, on June 15, 2022, a government notification told the public that these regulations had been altered. This announcement states that a financial year’s worth of contributions to the GPF account cannot exceed Rs 5 lakh.

GPF NEW RULES

The government has issued a notification

The Department of Pension and Pensioners Welfare (DoPPW) then issued another office memo on October 11, 2022. The General Provident Fund (Central Service) Rules, 1960 are referenced in this GPF New Rule, which specifies that the GPF for a subscriber cannot be less than 6% of the subscriber’s total wages. That is, there was no upper limit at the time, but this is no longer the case.

What is GPF?

Let’s now discuss what the GPF is. One kind of provident fund (PF) account that not all employees can access is the GPF. GPF benefits are exclusively available to government employees. Government workers are required to pay a portion of their salaries to the GPF to do this. Government personnel are required to participate in this. At the time of the employee’s retirement, the total of the contributions made by the employee to the GPF during the employment period is then paid.

Let us explain that only employee contributions are made to the GPF; no government funds are used for this purpose. In addition, the Finance Ministry rotates the GPF interest rate every three months.

Know the GPF interest rate

Let us tell you that the interest gained on GPF is currently equal to that of PPF. It is noteworthy that the Department of Economic Affairs (DEA) has not altered the interest rates for the quarter from October to December of 2022; they are currently at 7.1 per cent.

Read More: Jan-Dhan Update: The central government made a big announcement, and the people of Jan-Dhan were bat-bats

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