All about Social Security Fund (SSF) in Nepal

Social Security Fund (SSF) aims to provide social security protection for maternity, sickness, employment injury, old age and retrenchment in accordance with internationally accepted principles. A medical scheme in addition cover payments for the treatment of medical conditions of the employees. The schemes will initially cover the formal sector and will be extended to the other sectors gradually. The vision of the government is to provide comprehensive social security coverage to the population and create a safe and secure work environment.

Here is a comprehensive list of the frequently asked questions (FAQs) about Social Security Fund.

Frequently Asked Questions about Contribution-Based Social Security Fund (Samajik Surakshya Kosh) Act and Rules

1. What percentage of the amount must be contributed to participate in the social security scheme?

Employers should contribute 20 per cent and contributors 11 percent and a total of 31 percent monthly and regularly.

2. What is meant by dependent family?

Dependent family means any living person living in the same family with the contributor and having the following relationship with the contributor.

1. A) Spouse,
2. B) son-in-law or daughter,
3. C) father, mother, mother-in-law or father-in-law,
4. D) Grandson or granddaughter.
5. What is contributory income?

Contributable income is the basic wage before deducting tax in accordance with the prevailing law, which the worker receives daily, weekly, fortnightly or monthly from direct or indirect employment.

4. How long should the contribution amount be deposited in the fund?

According to Section 7 of the Contribution-Based Social Security Act, the amount must be deposited in the fund within fifteen days of the end of the month in which the contributable income has to be paid.

5. What happens if the contribution amount is not deposited on time?

If the contribution is not deposited within the stipulated time as per Section 9 of the Contribution Based Social Security Act, the fund will collect ten percent interest on the amount to be deposited in the fund. The Contributor is even deprived from the facility of Disability and Dependent Family Protection Scheme in such cases.

6. What happens if the contributor is found to have claimed more benefits by submitting incorrect details?

Pursuant to Article 47 of the Contribution Based Social Security Act, there is a provision to recover such amount from the contributor if he / she is found to have made false claim by submitting wrong details.

7. What is Actuarial Valuation?

> The assessment done to ascertain the possibility to increase the facilities provided by the fund to the contributors considering the investment made by the organization, financial status, demographic structure of the contributors, claims payment and other liabilities is called actuarial assessment.

8. Is it possible to participate in only one of the existing security schemes or not?

All the schemes are mandatory.

9. Why is it not mandatory for government employees to contribute to the fund?

According to Article 21 of the Act, the employees in the government service will be as prescribed by the government. Currently, there is another pension program based on the contribution of government employees operated by the Employees Provident Fund unless other alternative provisions are made.

10. Within how many days should the fund be informed if any employee leaves the job?

According to the section 24 of the Contribution Based Social Security Act if any employee leaves employment the employer has to inform the fund within one month.

FAQs Regarding Labour act and regulations for SSF

11. What is meant by basic remuneration?

“Basic remuneration” means the basic remuneration to be received by a labour for employment, and this term also includes the amount of increment in remuneration after the completion of one year of the employment period.

12. How to separate basic wages and allowances?

According to Rule 66 of the Labour Regulations, at least 60 percent of the total wages will be basic wages.

13. What is the provision in the Labour Act regarding the provident fund, allowance and insurance?

According to Sections 52, 53, 54 and 55 of the Labour Act, a total of 20% (10 percent from the employee and 10 percent from the employer) provident fund should be deducted.

Also, an employer shall provide a gratuity of 8.33% of the basic salary, a minimum of Rs 1 lakh for medical treatment and Rs 7 lakh for accident insurance.

14. What is a labour audit?

A labour audit is an audit to ascertain the status of compliance with labour laws, regulations or prevailing laws. In which the above-mentioned issues can be inspected and verified by the labour inspector at any time.

15. What is the minimum wage of Nepal, and how is it determined?

The minimum wage is the minimum wage determined by the committee under the Ministry of Labour to determine the minimum wage every 2/2 years. At present, such remuneration is Rs. 13450 (In the case of regular employees)

16. What is the provision for current benefits when joining a social security scheme?

According to Article 178 (3) of the Labour Act, the current benefits are not decreased.

In addition, Rule 23 (4) of the Labour Rules stipulates that if the amount taken by someone at the time of commencement of the rules is more than one month, the amount to be deposited in the fund is to be deposited in the contribution-based social security fund.

17. What are the provisions for contributing to the fund for part-time workers?

Employees who work part-time should be included in the scheme like other employees.

Regarding social security scheme operation procedures

18. What happens if you do not participate in security plans based on Social Security Fund contributions?

It is mandatory to participate in the social security scheme. If not, you may be deprived from government facilities.

19. Should a person who has completed 60 years of age be listed in the Social Security Fund if he is still employed?

There is an arrangement to participate voluntarily.

20. What does a dependent family get if a contributor dies within a short time of receiving a pension?

In case of the death of the contributor less than 15 years after the commencement of retirement, 50% of the pension amount received by his / her spouse will be paid monthly while he/she is alive.

21. Is there a provision for selection of pension or retirement schemes in the case of workers who join employment on or after 1st Shrawan, 2078?

In the case of workers who have been employed on or after Shrawan 1, 2078, after contributing to the fund for 15 years, they are required to participate in the compulsory pension scheme and in case of not contributing for 15 years even after reaching 60 years of age, there is a provision to choose either pension or retirement facility scheme.

22. Does a person receiving a pension from the Government of Nepal or elsewhere get a pension from the Social Security Fund or not?

Since the pension received from the Social Security Fund is a contribution based pension, the person receiving the pension from elsewhere also gets the pension from the Social Security Fund.

23. If a Nepali citizen has to go abroad for permanent residence, will the old age security plan deposited in the fund be paid to him?

There is a provision to get lump sum payment. But in order to get the money back, you have to get a permanent residence permit of a foreign country.

24. What are the benefits of joining a Social Security Fund?

There is an arrangement to provide the facilities to the contributors in the following four schemes as per the security plan procedure 2075:

-Medicine, health and maternity protection plan,

-Accident and Disability Safety Plan,

-Dependent Family Protection Scheme,

-Old age protection plan.

25. When will the Medicare, Health and Maternity Protection Scheme be implemented?

Such a plan is implemented after contributing to the fund for at least three months.

26. What are the benefits of maternity protection?

Apart from 60 days of paid maternity leave from the employer, 60 percent of the basic wage is paid for maternity leave for an additional 38 days, and a minimum wage of one month per baby is provided for the care of a newborn baby. In addition, the contributor or contributor’s wife will be provided with regular pregnancy test, hospitalization, surgery, expenses related to delivery up to 6 weeks after delivery and treatment of the baby up to three months.

27. How much health benefits, and what are the conditions?

Contributors get up to Rs. 80,000 (of Rs. 1,00,000) for hospitalized treatment (IPD service) and Rs. 20,000 (of Rs. 25,000) for non-hospitalized treatment (OPD service). The Second Amendment has made it possible to get the facility by merging the expenses of OPD into IPD.

28. When will the accident safety plan be implemented?

This scheme contribution is applicable from the date of deposit in the social security fund.

29. What benefits do workers get if they have an employment-related accident or have an occupational disease?

Employment-related accident contribution applies from the date of commencement and Occupational Diseases Facility starts two years after the contribution to the Social Security Fund. In both cases the fund bears all expenses for the treatment.

30. What happens if there is an accident other than employment-related?

In such cases, treatment expenses up to Rs 7 lakh will be borne by the fund. If seven lakh is born by other insurance companies, the fund will not pay but will add an amount to make it seven lakhs.

31. What benefits can a dependent family receive if the contributor dies before reaching retirement age?

> contributor’s heirs gets the total of the contribution made to the through the old age protection plus the amount and the return on investment of the fund,

> Retirement of 60% of the final basic salary to his / her spouse if he / she is not employed while he / she is still alive.

Forty percent of the final basic salary if the contributor has one child; until he / she completes 21 years of age.

If more than two children, maximum two children will be provided forty percent of the basic salary divided equally.

> If the contributor is not married, the parents of the same household will get it,

> Total of Rs. 25,000 as funeral expenses.

32. What benefits does SSF provide in case of permanent disability?

>In case of complete disability of the contributor,Provision will be made to provide pension  at the rate of 60 percent Contributor’s final basic remuneration to the contributor until death.

33. What happens if the contributor completes 180 months and reaches the age of 60?

> There is a provision for such contributors to collect the amount in one lump sum or divide it by 160 and convert the amount into a lifetime pension.

34. What is the payment process like?

Provision has been made for the hospital to claim the expenses incurred by the fund in case of medical treatment, health and maternity safety and accident and the payment will be deposited directly by the fund in the bank account of the hospital. In addition, there is an arrangement to transfer the pension received by the dependent family and other benefits received by the contributor directly to the bank account of the contributor.

35. What are the benefits to the employer company by joining the social security fund?

> According to the Labour Act 2074, there is a legal provision to provide treatment,  accident and health insurance, gratuity, and allowances by the employer. On the one hand, there is no hassle to provide these various facilities to the employee separately and on the other hand, a dignified working environment is created and investment-friendly environment is developed.

36. What is the cost of maternity care if more than one child is born?

> According to the Social Security Fund Scheme Operation Procedure, 2075, there is an arrangement to increase the maternity care expenses per baby.

37. What is the reason for reaching 60 years of age to avail the benefits of old age protection plan?

> In the context of the Contribution Based Security Act of Nepal, since the working age of a person is 60 years, such provision has been made for the continuity of income after retirement by considering the same age as retirement age.

38. What is the provision for the contributor to withdraw the deposit before reaching 60 years of age?

Contributors who start contributing by 30th Asar, 2078 will be able to withdraw all the amount deposited in the pension and retirement fund and contributors who contribute on or after 1st Shrawan, 2078 will be able to withdraw the amount deposited in the retirement fund in case of separation from employment. For which you don’t have to wait for 60 years.

39. Is the Employment Accident Treatment Expenses shared or will Social Security Fund bears all expenses?

> In case of employment-related or occupational diseases, the contributor does not have to pay 20 per cent, the entire expenditure is borne by the fund.

40. What are the grounds for proving that any worker is fully and partially disabled under the Disability Protection Scheme?

The Disability Percentage is determined by the fund’s subcommittee, which includes a medical officer.

41. What is the maximum number of days that the claim amount is available in the social security scheme?

There is an arrangement to provide such payment to the health institution within 30 days of receiving all the documents / proofs.

42. Is there any adjustment in the amount of pension?

As per 24 (b) of the Security Planning Procedure, the pension amount is increased with the increment of insurance assessment every 3 years.

43. What happens in case of payment from another insurance system for paying up to Rs. 7,00,000?

> Could have double insurance in case of an accident. Since insurance is based on the principle of indemnity, it is not possible to claim double benefits in this regard. For example, if one receives Rs 300000 from other insurance, the remaining 400000 can be claimed from SSF.

TAX Related Questions

44. Is it necessary to pay one percent tax as social security tax after starting to contribute to the social security fund?

Contributors contributing to the Social Security Fund do not have to pay one per cent social security tax as per Section 21 (4) of the Financial Act.

45. How much monthly income is double taxed, and how much is not taxable?

As per sub-section (1) of the Income Tax Act 63, the amount deposited in the social security fund has been recognized as an approved pension, so there is no possibility of double taxation.

Regarding the deposit and claim of SSF Nepal

46. Where and how to deposit Social Security funds?

> One can deposit the amount in Social Security Fund’s account from any bank or financial institution with Connect IPS from te employer’s account. Deposits can be made directly to the Social Security Fund account through Connect IPS of the bank having the employer’s account.

47. How to participate in Social Security Fund?

> One can go to SOSYS Online Registration on the Social Security Fund’s website www.ssf.gov.np and register for SSF after filling form.SSF will provide a certificate, social security number, username and password electronically. Then the details of employees can also be filled from the portal.

48. What are the details or documents that the contributor has to submit in order to claim the benefit of contributing?

> Different applications have been submitted for separate schemes for claiming the facility. The application can be downloaded as required from the Claim manual at the website: www.ssf.gov.np.

Regarding loans and investments

49. What is the provision of loans in the social security fund?

There is a provision of 3 types of collateral-based loans for housing, education and social work. But for the loan, you have to have contributed to the fund for three consecutive years.

50. What is the interest rate on the loan facility provided by the fund?

Provision has been made to transfer the loan at the same interest rate if the contributor who has taken a loan from another retirement fund based on collateral joins SSF. The interest rate of the loan provided by the fund is less than the market rate.

51. Is the money deposited in the social security fund a return on investment or not?

> All the earnings (according to the actuarial assessment) is received by the contributor himself.

IT-related FAQs on SSF Nepal

52. How can an employer deposit money in a fund?

For this, please see the “sosys user manual” at the fund’s website: www.ssf.gov.np.

53. Can a worker leave a company and continue to contribute from another company or if the employee becomes unemployed?

> Contribution can be continued from the same Social Security Number (SSID).

54. How to get Employer Listed Certificate?

The certificate of registration of the employer is sent to the official email of the concerned organization after the details are received and can be downloaded from the employer portal.

55. How to get a contributor ID card?

There is an arrangement to print the identity card from the contributor list in the report within the sosys on the fund’s website and also to make it available from the fund.

56. What does it take to join a new employer fund?

To join the fund, go to the Social Security Fund’s website www.ssf.gov.np, go to SOSYS Online Registration and go to New Registration and fill in the details in the form.

57. What documents are required to join a new employer fund?

When joining a new employer fund, details of the employer, details of the chief executive or chairman of the employer organization as well as documents registered in the PAN or VAT of the organization are required. If the employer is a foreigner, a letter certified by the embassy is also required.

58. How to add contributors?

Employers can be added to the fund in two ways:

Filling KYC Form on the Contributor Manual or In case of numerous contributors, this can be done by filling out the Excel Sheet provided by the Fund.

59. How to view the total number of contributors in your organization?

> Only details of verified contributors can be seen which go to Reports> Employee list.

60. How to change the password in the SSF dashboard?

Click on Change Password and then Old Password> New Password.

61. What to do if I forgot my password?

> Go to Employer Portal and click on Recover Password.

> Enter your SSID.

> Then you will get a link or password to change the password in your email address.

62. How to view the amount deposited in the fund in SOSYS?

> Click on Report and go to Collection.

> Select contribution start date and end date.

63. How to view a detailed list of contributors?

> Go to Report and see the Contributor Detail inside the Registration.

> Then the contributor’s SSF No. Enter.

64. How to remove contributors listed in the fund?

> Go to Collection.

> Click the Contributor button that needs to be removed.

65. What to do if you forget the submission number?

> Go to Contributor Status in Report.

66. If the contribution amount is more than 1 million, how to contribute?

> Work is being done in this regard.

67. What should be the file size to be uploaded in SOSYS?

> Upload to SOSYS file size must be less than 1 MB.

68. How is the status of the contributor informed?

> “C” = KYC form not filled,

> “I” = details saved but not submitted,

> “F” = sent to the Fund for Verification,

> “T” = details verified from the fund.

Other common queries related to SSF Nepal

69. Should national and international, non-governmental organizations (NGOs, INGOs) and their staff be included in the fund or not?

> They should.

70. What is the difference between the benefits received from the Social Security Fund and the benefits received from other funds?

> All organizations have their own importance. The scope of work of the organizations is determined in accordance with the legal provisions to address the needs of the time. The Social Security Fund is an institution established to operate all types of social security schemes in the package.

71. Are people in the informal sector or self-employed allowed to join the Social Security Fund or not?

As the Contribution-Based Social Security Act provides that any type of employed person can join the fund, those working in the informal sector and even the self-employed can join the fund for which a separate working method is being developed.

72. What happens if I leave after contributing only for a short period of time?

> In case of leaving after contributing for some time, the amount deposited in the retirement fund can be withdrawn in case of separation from the job and the amount deposited in the pension fund must have reached 60 years to get a lump sum withdrawal or pension as per the rules.

73. How is the money deposited by the contributor invested?

> 31 percent of the amount paid by the contributor is distributed to the respective schemes and 

the portfolio of money is invested in different sectors according to the principle of diversification.

74. What is the basis for deducting 31 percent?

In fact, with the implementation of the Social Security Act is related to Labour Act 2074 and the fundamental rights of the constitution In the Labour Act 2074, there is a mandatory provision of 20 percent per month for the provident fund,  8.33 percent gratuity, medical treatment and accident insurance. Social Security Fund contribution of 31 is based accordingly.

75. Is there any reward for not contributing?

There is an arrangement for the contributors to get the return from the investment of the old age condition protection scheme deposited in the fund proportionally.

76. What happens if treatment done in hospital that does not have MOU  with SSF?

> If one has to go to the hospitals without MOU with SSF for treatment for business related accident, the fund must be informed within seven days of the accident. If the treatment is not done without informing, the fund will not cover more than seven lakh rupees no matter how much is spent. However, treatment related to medical treatment, health, and maternity protection should be done in the hospital where MOU is done.

General Info FAQs Regarding social security fund

77. When was the Social Security Fund formally launched?

> The Social Security Fund was formally launched on Mangshir 11, 2075.

78. When was the Contribution-Based Social Security Act issued?

> Contribution Based Social Security Act was issued on Shrawan 29, 2074.

79. When did the Contribution-Based Social Security Act come into force?

> Contribution Based Social Security Act came into force on 2nd Kartik, 2074 BS.

80. Why the need for a Social Security Fund?

> Article 34 of the Constitution provides for the right to social security based on contributions as a fundamental right.

81. What is the current slogan of the Social Security Fund?

The slogan of the fund is “Social Security and Employment is the basis of good Labour relations”.

82. What is the theoretical basis of social security fund operation?

The theoretical basis of social security fund operation is to guarantee the health and safety of the contributor workers while they are working and to give them a sense of dignified Labour and dignified life by guaranteeing continuity of income while they are not at work.

83. Who controls the fund?

> There is an arrangement for the Social Security Fund to have a secretary in the Ministry of Labour, Employment and Social Security.

84. What is the composition of the Social Security Fund Steering Committee?

> The Social Security Fund Steering Committee has a tripartite arrangement in which a total of 13 members including the government, employers and workers’ representatives will be the moderators.

85. What are the facilities schemes run by the fund based on?

> The facility schemes operated by the Fund are based on the international minimum standards of social security set by ILO Convention 102.

86. Where is the office of Social Security Fund?

The office of the Social Security Fund is located at BabarMahal, Kathmandu.

87. What is the parent ministry of the fund?

> The Ministry of Labour, Employment and Social Security is the parent ministry of this fund.

88. Need to understand other essentials in the fund?

> Hotline no. 1116, contact no. Information can also be obtained by contacting 01-5970016, 01-4256144, 01-42566315 or through the fund’s website www.ssf.gov.np, Facebook page.