Big Provident Fund relief! Deadline for EPF contribution by employers extended till 15th May
Modi Government has increased the due date for PF contribution by employers to 15th May. This relief will benefit about 6 lakh establishments to file ECRs without default by paying salary to about 5 crore employees.
In a bid to support and provide relief to employers of establishments which have disbursed wages for March, 2020 to its employees and an incentive to employers to pay salaries during COVID-19 pandemic, the Narendra Modi Government has increased the due date for PF contribution by employers to 15th May. This relief will benefit about 6 lakh establishments to file ECRs without default by paying salary to about 5 crore employees.
Informing about the decision the Ministry of Labour & Employment said, "Considering the unprecedented situation created by COVID-19 and lockdown announced by the Central Government from 24.03.2020 midnight onwards to prevent the spread of Covid-19, the due date for filing of Electronic Challan Cum Return (ECR) for wage month March, 2020 is extended up to 15.05.2020 for employers who have paid wages to their employees for March, 2020." The ministry statement went on to add that due date for March, 2020 is ordinarily 15.04.2020, so grace period of thirty days has been allowed to the establishments covered under EPF & MP Act, 1952 to remit the contributions and administrative charges due for March 2020.
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This relief will benefit about 6 lakh establishments to file ECRs without default by paying salary to about 5 crore employees. The employers have to declare the date of disbursement of wage for March, 2020 in the ECR for March, 2020. The ECR, with the said declaration, and contributions and administrative charges for March, 2020 are now due on or before 15.05.2020. The employers disbursing the wages for March, 2020 not only get relief of extension of due date for payment of EPF dues for March, 2020 but also avoid liability of interest and penalty, if they remit on or before 15.05.2020.
Hailing the Narendra Modi Government's move, Saraswathi Kasturirangan, Partner at Deloitte India said, "Significant relaxations in timelines have been provided earlier for tax related year end compliance. The current relaxation in respect of extending the due date for PF contributions for the month of March to 15 of May will certainly help companies plan their cash flows better. It could of course have the impact on employees interest earnings in PF contribution for the month of March."
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