A Voluntary Provident Fund is a contribution that one makes towards their provident fund account over their Employee Provident Fund contribution. This a scheme made specifically for salaried employees who wish to add to their provident fund. VPF is basically an extension of the Employee Provident Fund.
This contribution is made beyond the 12% of the contribution made by an employee towards their Employee Provident Fund. The employee can contribute up to 100% of their basic salary as well as their Dearness Allowance (DA). The interest earned on the VPF is credited to their EPF account and the interest offered is as per with the EPF scheme.
Once a plan for VPF has been chosen, it cannot be terminated or discontinued before the completion of the base tenure of 5 years. In such a scenario, the employers are under no obligation to contribute to the VPF of their employees.
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