A common compliance-related query among HR, payroll, and secretarial teams is whether an establishment must file an IW‑1 return under the Employees’ Provident Fund Scheme, 1952 (EPF Scheme), even when it has never engaged any International Worker (IW).
This question gains importance in view of routine EPFO inspections and portal requirements. To provide clarity, it’s essential to differentiate between what the law states and what EPFO expects administratively.
Legal Position under the EPF Scheme
As per Paragraph 83 of the EPF Scheme, 1952, the obligation to file the IW‑1 return arises only when an establishment employs one or more International Workers. The provision does not mention or require filing of a ‘Nil’ return in cases where no IWs are engaged.
Thus, from a purely legal standpoint, there is no statutory obligation to file the IW‑1 return if an organisation has never employed an International Worker.
EPFO’s Administrative Circular – A Broader Expectation
However, the situation becomes more nuanced when we look at the EPFO’s administrative circular dated 25.05.2012. This circular introduces an expectation—not found in the legal text—that even establishments without any IWs should file a Nil IW‑1 return on a monthly basis.
The circular was issued to ensure consistency in reporting and streamline EPFO’s internal processes. While it does not amend the law, it reflects EPFO’s operational approach towards tracking compliance across all establishments, regardless of whether IWs are employed.
So, What Should Organisations Do?
| Aspect | Position |
| Legal Requirement | IW‑1 filing is not required if no International Workers are employed. |
| EPFO Administrative View | EPFO expects monthly Nil IW‑1 returns even if no IWs are employed. |
| Best Practice | File Nil IW‑1 returns to avoid portal flags, queries, or non-compliance risk. |
While non-filing may not attract direct penal consequences under the Act, many establishments adopt a cautious approach and comply with the circular to avoid future complications or system-generated compliance gaps.
Industry Sentiment
Legal and industry experts, including publications by reputed law firms, acknowledge this administrative-practical gap. Still, the consensus in the compliance community leans toward filing Nil IW-1 returns as a matter of good governance, especially in large, multi-location, or audit-sensitive entities.
Conclusion
To answer the central question:
No, it is not legally mandatory under Para 83 of the EPF Scheme to file an IW-1 return if your organisation has never employed any International Worker.
However, EPFO expects monthly Nil returns based on its administrative directive issued in May 2012.
Given this, organisations are advised to balance legal interpretation with regulatory expectation and adopt a risk-mitigated approach by filing the Nil IW‑1 return regularly—even if no IWs have ever been on their rolls.
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Disclaimer: This article is intended for general awareness and should not be treated as legal advice. For case-specific guidance, consult with your legal or compliance team.
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