You will need to register for EPF if:
Once you reach an employee strength of 20, you will need to complete the EPF registration within 30 days. Failing to do this could lead to penalties. Once you have registered, you will be required to provide EPF benefits even if you reduce the number of employees below 20.
Besides achieving minimum employee strength there are other ways that can make EPF registration necessary. For instance, even if your employee count is less than 20, the central government can ask you to register with a minimum of 2 months’ notice.
Moreover, in case you and a majority of your employees mutually agree to register for EPF, you can make an application to the Central PF (Provident Fund) Commissioner. After the Central PF Commissioner receives the application, you can go ahead with the registration of your organization. This is done once a notification is passed in the Official Gazette from the date of such agreement or from any other date specified in the agreement.
Although not compulsory, companies with an employee count less than 20 can also voluntarily obtain PF registration. In this case, an EPF registration automatically makes all employees eligible for EPF benefits once their employment commences. It is then the sole responsibility of the employer to make deduction & payment of PF.
The PF contribution of 12% needs to be divided equally between you and your employees. The employer’s contribution is 12% of basic salary. The PF deduction rate is 10% for the companies that have less than 20 employees.