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EPS Pension Calculation: Rs 62,000, basic salary, 18, 25, and 32 years of service, find out your monthly pension
- Written by Anamika Singh
Published: Zee Business| Updated: Zee Business
The monthly pension for an employee is calculated based on their service tenure, which is rounded up to the nearest year if they have worked six months or more. For example, 10 years and 7 months of service would be counted as 11 years. Let's consider an employee with a basic salary of Rs 62,000 and varying service periods of 18, 25, or 32 years. The pension amount would be calculated based on these service years and the basic salary. To determine the pension amount, let’s follow the formula given below.
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How does EPS contribution work?
1/8When it comes to saving for retirement, both you and your employer contribute to it. Here's how it works: You and your employer each put 12 per cent of your basic salary into a fund. Your employer's 12 per cent is split into two parts: 8.33 per cent goes into the Employee Pension Scheme (EPS) and 3.67 per cent goes into the Employees' Provident Fund (EPF).
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Who is eligible for Employee Pension Scheme (EPS)?
2/8Those who have attained the age of 50 years for early pension and 58 years for regular pension. You must be a member of the EPFO. You must have completed 10 years of service.
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EPS calculation conditions
3/8The formula for calculating the EPS pension is: Monthly pension amount = (Pensionable Salary x Pensionable Service) / 70.
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Monthly Pension Calculation: Pensionable service, 18, 25, & 32 years
4/8The monthly pension amount you will receive will depend on your pensionable salary and service. The average salary used in the formula is the average of your basic salary plus your DA for the last 12 months.
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Pension Calculation
5/8Contributing to the (present) wage ceiling of Rs 15,000. Even if someone's basic salary and dearness allowance is Rs 62,000, their EPS pension will be calculated at Rs 15,000 salary.
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What will be your monthly pension with 18 years of service?
6/8(Pensionable Salary X Pensionable Service)/70 = (15,000x18)/70 = Rs 3,857. Individuals may get around Rs 3,857 as a pension for their service period of 18 years.
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What will be your monthly pension with 25 years of service?
7/8(Pensionable Salary X Pensionable Service)/70 = (15,000x25)/70 = Rs 5,357. Individuals may get Rs 5,357 as a pension if the service is 25 years.
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What will be your monthly pension with 32 years of service?
8/8(Pensionable Salary X Pensionable Service)/70 = (15,000x32)/70 = Rs 6,857. Individuals may get around Rs 6,429 as a pension for their service of 32 years.
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