What is Voluntary Provident Fund?

You should not ignore the fact that VPF comes with withdrawal restrictions and full withdrawal is possible only at the time of retirement.

Getty Images
VPF is also available for deduction and therefore, can be a good tax planning tool.
1. VPF is the voluntary contribution by employees towards the provident fund account over and above the 12% contribution towards EPF.

2. The maximum contribution allowed under VPF is up to 100% of the basic salary and dearness allowance.

3. The VPF gives the same interest as the EPF which is revised annually.


4. Unlike for EPF, the employers are under no obligation to contribute to their employees’ VPF portfolio.

5. VPF contribution is also eligible for deduction under Section 80C.

(The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
Download
The Economic Times Business News App
for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App
for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
READ MORE
ADVERTISEMENT

READ MORE:

LOGIN & CLAIM

50 TIMESPOINTS

More from our Partners

Loading next story
Text Size:AAA
Success
This article has been saved

*

+