EPF Wage Ceiling Is Now ₹25,000: What It Does to Your In-Hand Salary

If your PF deduction jumped on your October 2026 payslip, this is why. On 17 September 2026 the government raised the EPF wage ceiling — the pay level PF is compulsory up to — from ₹15,000 to ₹25,000 a month (notification S.O. 5109(E), announced by PIB on 16 September).

What changed

PF is 12% from you and 12% from your employer. Many employers pay it only on wages up to the ceiling, even if your Basic is higher. At the old ₹15,000 ceiling that was ₹1,800 a month each. At ₹25,000 it's ₹3,000 a month each. The pension (EPS) part of your employer's share is capped the same way, so its maximum goes from ₹1,250 to ₹2,083 a month (PIB).

Who it affects

• PF on the old ceiling, Basic above ₹15,000: your PF rises to 12% of your Basic or of ₹25,000, whichever is lower. This is the group that sees lower take-home.
• Earning ₹15,000–₹25,000 a month: PF is now compulsory for you, where it wasn't before. PIB expects over 51 lakh more employees to be covered.
• PF already on your full Basic: nothing changes.

The rupee change

Three salaries where PF was on the old ceiling, Basic at half of CTC, New Regime, employer PF inside CTC:

PF rises by ₹2,400 a month in every case: ₹1,200 more of your own PF, and ₹1,200 more employer PF that comes out of the same CTC. At ₹24L the take-home drop is a little smaller, because the higher employer PF lowers your taxable salary and you pay ₹3,744 less income tax a year.

None of it is lost. Both halves go into your PF account and earn interest; it's money moved from this month to retirement. If your employer pays its PF on top of CTC rather than inside it, only your own ₹1,200 comes out of take-home.

The tax side

Your own PF counts towards Sec 123 (old 80C) — but only in the Old Regime. Employer PF isn't taxed in either regime unless employer PF, NPS and superannuation together cross ₹7.5 lakh a year (Sec 17(1)(h) of the Income-tax Act, 2025), which no salary in this table comes close to.