Explained: EPFO's VISHWAS 2026 — Who can benefit from the one-time PF penalty relief scheme and how it works

The Employees' Provident Fund Organisation (EPFO) has introduced VISHWAS, 2026, a one-time dispute settlement scheme that gives eligible employers an opportunity to resolve pending disputes related to damages imposed for delayed provident fund (PF) contributions at concessional rates. The initiative is aimed at reducing long-pending litigation, improving compliance, and encouraging employers to clear dues. 

The scheme, notified under the EPF Scheme, 2026, came into effect on June 29 and will remain open for six months. It covers disputes arising under Section 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, as well as the corresponding provisions under the Code on Social Security, 2020. 

What is EPFO's VISHWAS, 2026? 

VISHWAS, 2026 is a limited-period dispute resolution mechanism that allows eligible establishments to settle cases involving damages levied for delayed PF remittances. Instead of paying the full damages prescribed under the law, employers can settle their cases by paying reduced damages, provided they meet the conditions laid down by EPFO. 

Which cases are covered under the scheme? 

The scheme has a wide scope and covers several categories of pending disputes. These include cases where damage orders have been challenged before courts or tribunals, finalised orders where the damages have not yet been fully recovered, proceedings where a notice has been issued but the final order is still pending, and even cases where damage proceedings have not yet been initiated. 

What are the reduced damage rates? 

For defaults that occurred before June 14, 2024, damages will be recalculated at concessional rates under VISHWAS, 2026. Employers will pay damages at 0.25% per month for delays of up to two months, 0.50% per month for delays of more than two months but less than four months, and 1% per month for defaults exceeding four months. These rates are mainly lower than the regular damages applicable under the EPF law. 

What conditions must employers fulfil? 

Employers cannot automatically avail themselves of the reduced damages. Before applying under the scheme, they must first pay the entire interest liability under Section 7Q. The application must then be submitted online through the EPFO Employer Portal and authenticated using a Digital Signature Certificate (DSC) or e-signature. 

Applicants are also required to provide a written undertaking confirming that they will not file any fresh appeal or legal proceeding after the dispute is settled. Once the competent authority approves the application, the employer must pay the settlement amount within 15 days. Following verification by the concerned regional office, EPFO will make the approval certificate available in the employer's online account. 

How will previous payments be treated? 

The scheme also clarifies the treatment of amounts already paid by employers. If an employer has already paid more than the revised damages calculated under VISHWAS, 2026, the excess amount will neither be refunded nor adjusted against the same demand. However, if the amount already deposited is lower than the revised damages, the employer will have to pay the balance amount to complete the settlement. The circular also explains how statutory pre-deposits made while filing appeals will be adjusted under the settlement mechanism. 

How can employers apply? 

Applications can only be submitted online through the EPFO Employer Portal using a Digital Signature Certificate or e-signature. Employers will be required to furnish details relating to the default period, damage order, amount already paid, proof of payment of interest and other prescribed information. 

Once the application is approved, the employer must make the payment within 15 days, after which EPFO will issue a digitally signed settlement certificate, formally closing the dispute. 

Which employers are not eligible? 

Not all cases qualify under the scheme. VISHWAS, 2026 does not apply where damages have already been fully recovered. It also excludes cases involving fraud, misappropriation or deliberate falsification of records. Employers who have not cleared the full interest payable under Section 7Q are also not eligible to avail themselves of the benefits. 

Why is the scheme important? 

VISHWAS, 2026 provides employers with a time-bound opportunity to settle long-pending PF damage disputes at substantially lower rates while avoiding prolonged legal proceedings. For businesses facing unresolved PF penalty cases, the scheme offers a chance to regularise compliance, reduce financial liabilities and bring closure to disputes while helping EPFO expedite recoveries and reduce its litigation burden.