EPS-95 Pension Scheme: 3 Major Benefits You Need to Know – How You Can Get a Pension from ₹1,000 to ₹7,500

(EPS 95 Pension) : The Employees’ Pension Scheme (EPS-95) is a crucial financial support system designed for employees in the organized sector. Managed by the Employees’ Provident Fund Organization (EPFO), this scheme provides a lifelong pension to eligible employees after retirement. With pensions ranging from ₹1,000 to ₹7,500, this scheme is a significant social security benefit for millions of employees. In this article, we will explore the major benefits of EPS-95, eligibility criteria, calculation methods, and steps to claim your pension.

What is the EPS-95 Pension Scheme?

EPS-95 was introduced in 1995 under the EPFO framework to provide post-retirement financial security to employees. Unlike the Employees’ Provident Fund (EPF), which is a lump-sum retirement benefit, EPS ensures that employees receive a monthly pension based on their contribution period and salary history.

Key Features of EPS-95:

• Minimum Pension Amount: ₹1,000 per month
• Maximum Pension Amount: ₹7,500 (for higher pension beneficiaries)
• Eligibility: Employees working in an EPFO-registered organization
• Contribution: 8.33% of the employer’s share in EPF goes to EPS
• Pension Start Age: 58 years (can be availed from 50 years with a reduced amount)
• Lifelong Pension: Paid to employees and then to their eligible dependents (spouse, children)

Major Benefits of EPS-95 Pension Scheme

1. Lifelong Pension for Employees

One of the biggest advantages of the EPS-95 scheme is that it ensures a lifelong pension for eligible employees after retirement.

• Employees who complete at least 10 years of eligible service are entitled to a pension.
• The pension starts at 58 years but can be availed earlier with a reduction.
• Even if an employee switches jobs, their EPS balance remains intact.

2. Family Pension for Dependents

If the pensioner passes away, the EPS-95 scheme continues to provide financial support to the surviving family members.

• Spouse Pension: The widow/widower is eligible for 50% of the pension amount.
• Children’s Pension: Each dependent child (up to 25 years) gets an additional 25% of the pension.
• Orphan Pension: If both parents are deceased, orphans get 75% of the pension amount.

3. Higher Pension Option for Maximum Benefits

A significant update allows employees to contribute based on full salary instead of the capped limit of ₹15,000, leading to higher pension amounts.

• Eligible employees can opt for higher pension calculation.
• This increases the pension amount to ₹7,500 or more, depending on salary history.

EPS-95 Pension Calculation: How Much Will You Get?

The EPS-95 pension amount is calculated using a simple formula:

Pension Amount = (Pensionable Salary × Pensionable Service) / 70

Here’s how different salary levels and service periods impact the pension amount:

Pensionable Salary (₹)	Years of Service	Expected Pension (₹/month)
10,000	10	1,428
12,000	15	2,571
15,000	20	4,285
18,000	25	6,428
21,000	30	9,000

Notes:

• Pensionable salary is the average of the last 60 months of basic salary.
• The maximum considered salary for regular EPS is ₹15,000, but opting for a higher pension allows a greater pensionable salary

  See More : LIC Pension Plan

How to Claim EPS-95 Pension?

Step-by-Step Guide:

1. Check Eligibility: Ensure you have completed 10 years of eligible service.
2. Submit Form 10D: This form is required to claim the monthly pension.
3. EPFO Processing: The regional EPFO office verifies your details.
4. Receive Pension: Once approved, the pension amount is credited to your bank account monthly.

Required Documents:

• Aadhaar Card
• Bank Account Details (with IFSC)
• PAN Card
• Service Certificate from Employer
• Death Certificate (if claiming family pension)

New Updates and Higher Pension Option in EPS-95

EPFO has introduced a higher pension option, allowing employees to contribute beyond the earlier salary cap of ₹15,000. This means:

• Employees who opted for full salary contribution to EPS can apply for a higher pension.
• The last date for application varies based on EPFO circulars.
• This ensures a substantially higher monthly pension post-retirement.

Comparison of Normal EPS vs. Higher Pension EPS:

Criteria	Normal EPS-95	Higher Pension EPS
Salary Considered	Up to ₹15,000/month	Full Basic Salary
Pension Calculation Basis	Limited Contribution	Full Salary Contribution
Expected Pension Amount	₹1,000 – ₹4,500	₹4,000 – ₹7,500+
Eligibility	10+ years of service	Must opt before retirement

Common FAQs on EPS-95 Pension

1. Can I get my EPS amount as a lump sum?

No, EPS does not offer a lump-sum withdrawal option. It provides a monthly pension after retirement.

2. What happens if I change jobs?

Your EPS contribution remains intact and is transferred automatically with your UAN.

3. Can I withdraw my EPS amount before 10 years?

If you leave service before completing 10 years, you can withdraw the accumulated EPS balance but won’t receive a pension.

4. How do I check my EPS balance?

You can check your EPS balance via the UMANG app or EPFO portal using your UAN.

5. Is EPS-95 pension taxable?

Yes, EPS pension is taxable under income tax rules. However, there are tax benefits under Section 80C.

The EPS-95 pension scheme is a crucial financial support system for retired employees, ensuring a stable income for them and their families. With options for higher pension contributions, employees can now secure a better post-retirement life. Whether you are an existing employee or a retiree, understanding the EPS-95 scheme and taking proactive steps can maximize your pension benefits.

If you haven’t checked your EPS eligibility or higher pension option, it’s time to do so and secure a better retirement future.