Key idea
Want more of that tax-advantaged, employer-grade return? You can add to your PF beyond the mandatory 12%. That extra is VPF.
The Voluntary Provident Fund (VPF) lets you contribute more than the compulsory 12% of basic into your PF account. The extra earns the same interest as EPF (8.25% for FY 2025-26) and enjoys the same tax treatment.
How it compares
EPF (mandatory)
- 12% of basic, automatic
- Employer matches your 12%
- Same ~8.25% interest
VPF (optional top-up)
- Any % above 12%, chosen by you
- No employer match on the extra
- Same ~8.25%, same tax rules
What makes it appealing, and its one limit
VPF offers a fixed, government-backed return with no market risk, deducted straight from salary so you never see the money. There is no employer match on the extra, but the rate is hard to match elsewhere at the same risk. The one thing to watch: interest on total employee PF contributions (EPF plus VPF) above ₹2.5 lakh a year becomes taxable. For most salaried people the limit is far away; for heavy savers it caps how much VPF stays fully tax-free. Figures for FY 2026-27. The Budget can change them each year, so confirm the current year.
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