What is Voluntary Provident Fund?

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.)