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December 4, 2025
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ByDhruvi
PF Registration vs PF Compliance: A Story Every Founder Should Hear
A few days after incorporating a new Private Limited company, a founder reached out to us at Ebizfiling with a question that had genuine worry behind it. The tone of their voice said more than the words. They had just opened an email containing a PF registration certificate that they never applied for. The moment they saw it, their mind jumped straight to penalties, deadlines, and compliance responsibilities they were not prepared for.
The message they sent us was simple. “I got a PF registration number. What do I need to file now? Do I have to submit a PF return or a Nil return? I only have a small team.”
This is exactly how many new founders feel. The company is new, the team is tiny, and yet a PF number appears out of nowhere. The immediate thought is that a legal requirement has already begun. The truth is much simpler than it feels in that moment.
The story that unfolded in our conversation is the story every new founder should hear.
The PF Number That Shows Up Before Your First Employee
When a company is registered through the AGILE PRO form on the MCA portal, the system automatically generates several registrations. PF is one of them. The founder we were speaking with had not planned for it, had not applied for it, and certainly did not expect it to appear within hours of incorporation.
Their first assumption was understandable. PF registration has arrived, so PF compliance must have started.
But that is not how the law works. The government allots the PF registration early, but the actual compliance begins only when the company meets the conditions.
We explained this step by step so they could breathe again.
What We Explained: The Difference Between PF Registration and PF Compliance
This is the clarity every new company needs.
|
Topic |
PF Registration |
PF Compliance |
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When it happens |
Automatically issued during company incorporation |
Begins only when the company has 20 or more employees |
|
Is action required immediately? |
No action required |
Monthly PF returns and contributions |
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Need for Nil return |
Not required |
Only required once PF becomes applicable |
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Salary relevance |
Not relevant at the registration stage |
Required when employees have basic wages up to 15000 |
|
Penalties |
No penalties for non-activity |
Penalties apply once PF is applicable and ignored |
Once the founder saw this table, the tension dropped from their voice.
The Real Question: Do New Companies Need to File PF Returns or Nil PF Returns ?
Our answer was direct and allowed them to relax finally.
No. A new company with fewer than 20 employees does not need to file PF returns or Nil PF returns. Also, here is the reasoning we shared with them.
PF registration is automatically allotted
This is only a code for future use. It does not activate compliance.
PF compliance applies only when
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The company reaches 20 or more employees, or
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The employer voluntarily chooses PF for the team
Until this point, absolutely nothing needs to be filed.
No applicability means no return
There is no hidden Nil return to be filed. No monthly form. No silent penalties. Nothing at all.
This was the part that brought real relief.
When the Company Grows, PF Steps In
A few months later, the founder contacted us again. Their team had grown, and they were now close to the threshold. This time, the tone was calmer because they knew what to expect.
Here is what we guided them through.
1. PF becomes applicable on reaching 20 employees
Once this happens, the registration number moves from passive to active.
2. Employee PF accounts need to be created
Every eligible employee receives a UAN number.
3. Employer and employee start contributing
PF contributions become a mandatory monthly activity.
4. Monthly PF returns begin
The ECR filing is done every month through the EPFO portal.
This is the real beginning of PF compliance. Not the day the PF number appeared.
Should a Small Company Choose Voluntary PF ?
We also explained this option when the founder asked whether they should adopt PF early.
Voluntary PF is allowed, but not mandatory.
Possible benefits
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Employees feel more secure
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Helps build a structured HR environment
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Shows a professional approach in some industries
Possible drawbacks
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Extra cost for employers at an early stage
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Adds administrative work
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Not required until the company scales
Most startups choose to wait until they cross 20 employees, and that is perfectly acceptable.
What Happens When PF Is Ignored After Becoming Applicable ?
We never hide this part because founders should know the full picture.
If PF becomes applicable and the company does not comply, penalties can include:
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Interest on delayed contributions
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Damages that increase the longer it is ignored
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Employee complaints that trigger inspections
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Legal notices in extreme cases
But again, none of these apply when the company is new and below 20 employees.
A Simple Checklist We Shared With the Founder
This is the exact checklist we provided to help them stay stress free.
Before crossing 20 employees
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PF registration received automatically
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No PF returns required
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No Nil returns required
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No penalty risk
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No PF account creation needed
After crossing 20 employees
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PF becomes mandatory
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Employee UAN creation
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Employer and employee contributions start
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Monthly PF return filing
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Regular compliance monitoring
This short list settled all worries.
A Message Every New Founder Should Hear
When the founder first contacted us, they were worried that missing a return or ignoring a number they did not apply for would put them at risk. After our explanation, they understood something that most new companies do not know.
PF registration is automatic. PF compliance is not. Compliance starts only when the company actually becomes eligible.
Until then, there is no action required.
No penalties. No hidden Nil returns. No surprise obligations.
At Ebizfiling, we see this confusion every day and we make sure every founder walks away with clarity, confidence, and peace of mind. If you ever receive a PF number before hiring even your first employee, remember this story. It saves time, energy, and unnecessary worry.
Your only focus right now should be growing your team. PF will wait until you are ready.
Suggested Read :
Employee Provident Fund: Myths Related to EPF Returns
Advantages of Using PEO Services for for Employees and Employers
Difference Between EPF and PPF
Frequently Asked Questions on PF Registration For a New Company
1. Why does a new company receive PF registration automatically?
A new company receives PF registration automatically because the MCA issues it through the AGILE PRO form during incorporation. This registration is allotted as part of the government’s integrated setup process and does not mean that PF compliance has started.
2. Does PF registration mean that the company must start filing PF returns immediately?
No, PF registration does not mean that the company must start filing PF returns immediately. PF returns are required only when the company becomes eligible under PF law.
3. When does PF compliance become mandatory for a new company?
PF compliance becomes mandatory only when the company reaches 20 or more employees or when the employer chooses to opt for voluntary PF coverage before reaching that number.
4. Do new companies need to file Nil PF returns when they have fewer than 20 employees?
No, new companies do not need to file Nil PF returns when they have fewer than 20 employees because PF is not applicable until the employee threshold is crossed.
5. Will a company face penalties if it does not file PF returns after receiving the auto issued PF registration number?
No, a company will not face penalties for not filing PF returns after receiving the auto issued PF registration number because penalties arise only when PF becomes applicable and the company fails to comply.
6. What happens if the company reaches 20 employees at any point in time?
If the company reaches 20 employees, PF compliance becomes compulsory, and the company must begin filing monthly PF returns and start PF contributions for all eligible employees.
7. Does employee salary affect PF compliance for a new company?
Yes, employee salary affects PF compliance because employees with basic wages of up to 15,000 fall under mandatory PF coverage once the company becomes eligible.
8. Can a new company choose voluntary PF even if it has fewer than 20 employees?
Yes, a new company can choose voluntary PF even if it has fewer than 20 employees, but it is optional and entirely the employer’s decision.
9. If the company has no employees, does any PF compliance apply?
If the company has no employees, no PF compliance applies and no PF returns or Nil returns are required.
10. Is PF registration useful for the future even if it is not being used right now?
Yes, PF registration is useful for the future because it activates automatically when the company grows and becomes eligible, which makes the transition to PF compliance faster and easier.
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