EPFO Pension: 12% of the Basic Salary + DA of employees working in the private sector is deposited in EPF every month. The same amount is also deposited by the employer/company. However, the company's share is divided into two parts. Out of this, 8.33% goes to the Employee Pension Scheme (EPS) and 3.67% goes to EPF every month. If an employee's share is deposited in EPS for a minimum of 10 years, then he becomes entitled to get a pension from EPFO after retirement. The amount of pension he will get is calculated by a formula by looking at his years of service and total contribution. Know that formula here and understand how much pension you will get after retirement. Pension is calculated by this formula.
The formula used to calculate how much pension you will get from EPFO after retirement is- EPS= Average Salary x Pensionable Service/ 70.

Understand how the formula will be used.
In this formula, average salary means basic salary + DA. Which is calculated based on the last 12 months. Pensionable service means how many years you have worked. Maximum pensionable service is 35 years. If the maximum pensionable salary is Rs 15 thousand. From this, the maximum pension share is 15000x8.33= Rs 1250 per month.

Understand by example
If we understand EPS pension calculation on maximum contribution and years of service- Suppose your average salary is Rs 15,000 and you have worked for 35 years. In this case, EPS = 15000 x35 / 70 = Rs 7,500 per month. In this way, the maximum pension an employee can get from EPFO is Rs 7,500. Whereas the minimum pension can be up to Rs 1,000. You can also calculate your pension amount by using this formula based on your average salary and total years of service.

Remember this thing
Remember that this formula of EPS will apply to employees working in the organized sector after 15 November 1995. There are different rules for employees before this. On the other hand, there is a constant demand from employee organizations that given the current wage structure and inflation rate, the maximum limit of average salary for pension should be increased.

If the contribution in EPS is less than 10 years
If the contribution of the employee in EPS is less than 10 years and he does not intend to work in the future, then in such a situation the employee can make a full and final settlement by withdrawing the amount deposited in EPS i.e. Pension Account along with the amount of EPF.