India – Key Provident Fund Operational Rules Notified under the Code on Social Security

The Government of India (GoI) notified certain operational aspects of the Code on Social Security, 2020 (CoSS) on 29 May 2026.

GoI has retained the wage ceiling of INR15,000 per month for Employees’ Provident Fund (EPF) contributions and has notified a rate of interest of 12 percent per annum for delayed payments by employers on any amount due under CoSS.

Inspection charges for exempt establishments under the EPF Scheme, 1952 have been increased, while retaining the rate of inspection charges under the Employee Deposit-Linked Insurance Scheme, 1976.

Additionally, key EPF officials have been appointed as inspectors-cum-facilitators and recovery officers with authority to inspect, file complaints, and levy damages.

WHY THIS MATTERS

While the final rules were notified, operational clarity on the wage ceiling, interest rate under the EPF were awaited from the Government. The notifications provide much-needed clarity on key compliance parameters under the CoSS, particularly in relation to EPF obligations such as wage ceiling, inspection charges, and interest on delayed remittances.

Background

GoI implemented the four Labour Codes by way of a notification on 21 November 2025. On 8 May 2026, the GoI notified the final Rules under the four Labour Codes. On 29 May 2026, in exercise of the powers conferred by the CoSS, GoI notified wage ceiling for EPF, interest for delayed payments, inspection charges for exempted establishments, and appointed key EPF officials as inspectors-cum-facilitators and recovery officers with authority to inspect, file complaints and levy damages.

Key Highlights

Wage ceiling¹

GoI has notified INR15,000 per month as the wage ceiling for the purpose of Employees’ Provident Fund.

Simple interest²

Employers shall be liable to pay simple interest at the rate of 12 percent per annum on any amount under the Code from the date on which such amount has become due till the date of its actual payment.
The above interest notification shall be deemed to have come into force on 21 November 2025.

Rate of inspection in case of exempted establishments³

In case of exempted establishments, GoI has notified the following rates in case of inspection charges:

Exempted from

Rate of Inspection

(percent of Wages)

Minimum Inspection Charge

(in INR)

EPF Scheme, 1952

0.35

8,750

Employees Deposit-Linked Insurance Scheme, 1976

0.005

1,250

Officers⁴

The following categories of officers have been notified as inspectors-cum-facilitators and recovery officers:

Central Provident Fund Commissioner
Additional Central Provident Fund Commissioner
Regional Provident Fund Commissioner
Assistant Provident Fund Commissioner
Enforcement Officer

They have also been granted powers to file complaints and levy damages in relation to establishments to which EPF regulations apply.

KPMG INSIGHTS

Organisations could closely review these developments and align their compliance processes accordingly.

If assignees and/or their programme managers have any questions or concerns about the scope of the update, its application and potential impacts, and appropriate next steps, they should consult with their qualified tax professional or a member of the GMS tax team with KPMG in India (see the Contacts section).

ENDNOTES:

1 The Gazette of India, “S.O. 2702(E),” published on 29 May 2026.

2 The Gazette of India, “S.O. 2698(E),” published on 29 May 2026.

3 The Gazette of India, “S.O. 2701(E),” published on 29 May 2026.

4 The Gazette of India, “S.O. 2700(E), S.O. 2697(E), S.O. 2699(E), and S.O. 2696(E),” published on 29 May 2026.

RELATED RESOURCE

This article is excerpted, with permission, from "Government of India notifies wage ceiling and other key aspects in relation to Employees’ Provident Fund,” Tax Flash News (1 June 2026), a publication of the KPMG International member firm in India.

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Parizad Sirwalla

Partner and National Head – Tax, Global Mobility Services

KPMG in India

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