Pension rules, charges and 2026 changes
EPS pension rules 2026 — eligibility, formula, early pension, family pension and minimum ₹1,000
How the Employees' Pension Scheme works in 2026: 10-year rule, the ÷70 formula, early pension from 50, family pension, scheme certificates and withdrawal benefit.
The Employees' Pension Scheme pays a monthly pension for life to EPF members who have at least 10 years of pensionable service and reach the scheme's pension age, 58. The amount is set by a formula, not by a balance: pensionable salary × pensionable service ÷ 70. The minimum pension is ₹1,000 a month. Business press reported in July 2026 that an Employees' Pension Scheme, 2026 under the Code on Social Security, 2020 replaced EPS-95; we could not confirm this from an official text, and EPFO's own August 2026 press release still refers to the Employees' Pension Scheme, 1995. Either way, reports say the formula, the 10-year rule and the minimum pension carried over unchanged, and existing members continue under the new framework.
Where the money comes from
You do not pay anything directly into EPS. The pension pool is funded by:
- 8.33% of your wages (up to the wage ceiling) from your employer's 12% share;
- 1.16% of wages (up to the ceiling) from the central government.
Your EPFO passbook shows the employer's pension contribution as a separate column. It is not a savings balance you own; it buys service credit in the pension scheme.
Eligibility in one table
| Situation | What you get |
|---|---|
| 10+ years of service, age 58 | Full monthly pension (superannuation pension) |
| 10+ years of service, age 50–57 | Early (reduced) pension, cut by 4% for each year before 58 |
| 10+ years, defer past 58 | Deferred pension with an increase for each year of deferment (check current rules) |
| Less than 10 years of service, leaving | Withdrawal benefit (lump sum based on a table) or a scheme certificate |
| Permanent and total disablement in service | Disablement pension, even without minimum service, if at least one month's contribution was paid |
| Death of a member or pensioner | Family pension to spouse, then children, orphans, nominee or dependent parents |
The formula in detail
Monthly pension = pensionable salary × pensionable service ÷ 70
- Pensionable salary is the average of the monthly wages on which EPS contributions were paid during the last 60 months of membership before exit. Under the rules in force until 2026 it was capped at the wage ceiling of ₹15,000 for most members (unless they had a valid higher-pension option). With the ceiling raised to ₹25,000 from 17 September 2026, the cap for future service rises, but how the averaging treats months on each side of the change needs to be confirmed from EPFO.
- Pensionable service is the number of years of contributory service. Service of six months or more in the final year is rounded up to a full year.
- A two-year bonus is added to service for members with 20 or more years of pensionable service who draw pension at the normal age, under the rules carried over from EPS-95.
A quick illustrative check: ₹15,000 × 35 years ÷ 70 = ₹7,500 a month, which is why ₹7,500 is often quoted as the practical maximum for someone on the ₹15,000 cap. The EPS calculation example works through several cases, including service before 2014.
Early pension and deferment
You can start pension from age 50 if you have 10 years of service and have left employment. The pension is reduced by 4% for each year you start before 58. Starting at 55, for instance, gives about 88% of the full amount for life. That reduction never goes away, so early pension is usually worth taking only if you need income or have health reasons.
If you keep working beyond 58, EPS rules have allowed you to defer pension to 60 with an increase for each year of deferment. Check how the 2026 scheme expresses this before deciding.
Leaving before 10 years
If you leave a covered job with less than 10 years of service, you have two options:
- Withdrawal benefit: a lump sum calculated from a table that multiplies your wages by a factor based on your years of service. You claim it with the EPF final settlement (Form 10C under the old forms). Under the October 2025 changes the waiting period for withdrawing the pension part after leaving a job was set at 36 months of unemployment.
- Scheme certificate: no payment now, but your service is kept and added to future EPS service when you join another covered employer. This is the better choice if you expect to return to formal employment, because it keeps you on track for the 10-year rule.
Once you complete 10 years of service, you cannot take a withdrawal benefit; the only option is pension at 50 or later.
Family pension
On the death of a member or pensioner, the spouse receives a widow or widower pension. Up to two children receive a children's pension until age 25. If there is no surviving spouse, orphans receive an orphan pension, reported as 75% of the widow pension in the 2026 scheme. Disabled children can receive pension for life. If there is no family, the nominee or dependent parents may qualify. Register nominees through e-nomination on the member portal to avoid disputes.
Higher pension
After the Supreme Court's November 2022 judgment, members who had contributed on actual wages above the ceiling could apply for a higher pension, with the employer's 8.33% on actual wages. Reports on the 2026 scheme say these higher-pension provisions are now part of the scheme text, with an effective employer contribution of 9.49% for those members. If you applied, follow the status on the EPFO portal; if you did not, the window that ran in 2023 has closed.
Claim timelines
The 2026 scheme reportedly requires EPFO to settle a complete pension claim within 20 days, with interest payable for unjustified delay. Most claims are now filed online through the unified member portal.
Related: EPF contributions and the wage ceiling, the 2026 overview and UPS for government staff.
Frequently asked questions
Is the minimum EPS pension going up?
Reports in 2026 say the minimum remains ₹1,000 a month, paid since 2014 with budgetary support. Demands for a higher minimum have not been adopted as of October 2026.
Does EPS pension increase with inflation?
No. EPS pension does not have automatic dearness relief. Plan for inflation with other savings.
Can I get EPS pension and a government pension together?
EPS pension is based on your service in EPF-covered employment. Receiving another pension does not by itself bar EPS pension, but service periods cannot be counted twice.
What happens to EPS if I move abroad?
Service under India's social security agreements with some countries can be treated differently. Ask EPFO's international workers cell or check the agreements listed on the EPFO website.
Official sources
- EPFO — pension scheme text and pension circulars
- Ministry of Labour and Employment — notifications under the Code on Social Security, 2020
- CPGRAMS — escalation for pension grievances
