> **Legal basis:** Paragraph 23, Employees' Provident Fund Scheme, 2026 (G.S.R. 525(E)), read with Section 7Q of the EPF & MP Act, 1952 — Effective: 29 June 2026. Source: EPFO Circular Compliance/E-102096/2025/2823 dated 9 July 2026. Last updated: September 2026. If your establishment has received EPFO demand notices, is sitting through a Section 7A enquiry, or has historical provident fund defaults stuck in litigation, EPFO has opened a time-bound window to close those matters at reduced penalty rates. VISHWAS 2026 is a one-time settlement scheme under Paragraph 23 of the newly notified Employees' Provident Fund Scheme, 2026, operationalised vide EPFO Circular Compliance/E-102096/2025/2823 dated 9 July 2026. It took effect on 29 June 2026 and the window closes on **28 December 2026**. ## What Is VISHWAS 2026? The scheme allows employers to settle pending damages and penalty demands — arising from PF contribution defaults that occurred before **14 June 2024** — at steeply reduced rates, avoiding prolonged litigation before EPFO, the EPF Appellate Tribunal, or the courts. ## Who Is Eligible? EPFO accepts VISHWAS 2026 applications from establishments falling into four categories: - **Ongoing litigation** — damages or penalty matters pending before EPFO, the EPF Appellate Tribunal, or courts. - **Finalised orders with pending recovery** — an order has been passed but payment remains incomplete. - **Pre-adjudication cases** — a Section 7A enquiry notice has been issued but no order has followed. - **Pre-notice cases** — defaults exist but no formal notice has been issued yet. **Exclusions:** cases involving fraud, and cases where the employer has not paid the entire interest due under Section 7Q of the EPF & MP Act, 1952 (or Section 127 of the Code on Social Security, 2020). ## How Much Will PF Damages Be Reduced? Under Paragraph 23 of the EPF Scheme, 2026, VISHWAS 2026 recalculates damages at rates well below the pre-existing regime. | Default Period | VISHWAS 2026 Damage Rate | | --- | --- | | Less than 2 months | 0.25% per month | | 2 to 4 months | 0.50% per month | | More than 4 months | 1.00% per month | For context on how large this reduction is: | Scheme | Basis | Damage Rate | | --- | --- | --- | | EPF Scheme, 1952 (Paragraph 32A) | Pre-VISHWAS regime | 25% to 100% of the arrear amount, depending on default duration | | EPF Scheme, 2026 (Paragraph 23) — VISHWAS 2026 | One-time settlement window | 0.25% to 1.00% per month, depending on default duration | > **Key point:** VISHWAS 2026 lets employers settle pre-14-June-2024 PF damages at rates as low as 0.25% per month, but only after the full principal arrear and Section 7Q interest have already been paid. **Illustrative example:** Sharma Electronics Pvt. Ltd., a Pune-based MSME with 45 employees, had a ₹6,00,000 PF arrear from FY 2021-22 — an 18-month default. Under VISHWAS 2026, damages recalculate at 1.00% per month × 18 months = ₹1,08,000, against a pre-VISHWAS exposure that could have run into several times that figure under Paragraph 32A. The employer must also pay full Section 7Q interest separately. *(Illustrative example — actual computation depends on EPFO's assessment.)* ## Critical Pre-Condition: Clear Section 7Q Interest First Before filing a VISHWAS 2026 application, the employer **must pay the entire interest** accrued under Section 7Q of the EPF & MP Act, 1952. This is a hard eligibility condition — EPFO will reject applications where any part of this interest remains unpaid. VISHWAS 2026 provides relief on **damages and penalties only**. The principal arrear and the Section 7Q interest must be paid in full as a precondition to applying. ## How to Apply: Step-by-Step 1. Log in to the EPFO Unified Portal (unifiedportal-emp.epfindia.gov.in) with your establishment credentials. 2. Navigate to the VISHWAS 2026 section and submit an online application. 3. EPFO verifies eligibility and issues the settlement computation. 4. Review the computation — you can agree, disagree, or request a re-evaluation. 5. Generate the payment challan and make payment. 6. Receive a digitally signed settlement certificate from EPFO. The entire process runs online through the Unified Portal. ## Why Act Now? The EPF Scheme 2026 Context VISHWAS 2026 sits inside the newly notified EPF Scheme, 2026 (G.S.R. 525(E)), which also brings changes that raise the stakes for any default left unresolved: - **Wages definition widened.** Contributions are now computed on "wages" as defined under Section 2(88) of the Code on Social Security, 2020 — broader than the earlier "basic wages" definition. Establishments with high-allowance salary structures may already be underdeducting without realising it. - **Principal employer liability strengthened.** Where a contractor defaults on PF, the principal employer becomes responsible for depositing both shares. - **Digital compliance mandatory.** Form V consolidated returns must be filed within 15 days each month. Settling historical defaults through VISHWAS 2026 before this stricter enforcement regime fully takes hold is a sound compliance step for any establishment carrying open PF exposure. I'm CA Harun Raaj, Visakhapatnam. If your establishment has an open Section 7A enquiry, a pending EPFO demand, or historical PF arrears, reach out before the 28 December 2026 window closes so we can assess your eligibility and Section 7Q position together. --- ## See Also - ["Bonus must be 20% of my salary": what the Payment of Bonus Act and the 2026 Code on Wages rules actually say](https://www.harunraaj.com/blog/statutory-bonus-2026-code-on-wages-rules) - ["Maternity leave is only for permanent employees": What the Maternity Benefit Act 1961 actually says](https://www.harunraaj.com/blog/maternity-benefit-act-26-weeks-creche-penalty) - ["We pay above minimum wage, so we're fine": what the Code on Wages 2019 actually requires in 2026](https://www.harunraaj.com/blog/minimum-wages-code-on-wages-2019-vda-records) Canonical: https://www.harunraaj.com/blog/epfo-vishwas-2026-settle-pf-default-notices