Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Interest and damages
PF must be deposited by the 15th of the following month. Delay attracts two charges: interest at 12% a year under Section 7Q, and damages under Section 14B that rise with the delay — broadly 5% for up to two months, rising to 25% for over six months (annualised). Both apply together. Confirm the current damages slabs.
The employee-share point
The law treats the employee’s share — which you deducted from their salary but failed to deposit — with particular severity, as it is effectively their money held by you. Persistent default can lead to recovery proceedings and prosecution of the employer/directors, not just monetary penalties.
A worked example
Example: a company deposits a ₹1 lakh PF dues three months late — it pays 12% interest pro-rata plus damages at the applicable slab, adding a meaningful sum. Repeated delays draw notices from the EPFO. Because the cost and risk are high, PF deposit should be a fixed monthly task. Our team can manage your PF deposits and returns on time.