Employees Provident Fund (EPF) is a government-backed retirement savings scheme. It falls under the aegis of the Employees’ Provident Fund Organisation and is governed under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
Under this scheme, an employer deducts a fixed percentage of an employee’s salary every month and deposits the amount in the employee’s EPF account along with a matching contribution of their own.
The funds accumulated in your PF account (principal and interest earned) can be withdrawn either online or offline:
Step 1: Download the Composite Claim Form from the official website
Step 2: If you are applying for EPF withdrawal through the Composite Claim Form (Aadhaar), link your Aadhaar number to your primary bank account (Aadhaar seeding), provide bank account details, and complete the activation process through the portal. If you apply through the Composite Claim Form (Non-Aadhaar), linking the Aadhaar card is not mandatory
Step 3: Fill out all necessary information on the form
Step 4: Ask your employer to attest to the form
Step 5: Submit the form to the relevant EPFO office in your jurisdiction
You can completely withdraw the PF amount only in the following circumstances:
Please note: You can’t withdraw the entire amount from your EPF account if you don’t remain unemployed for two or more months while switching employers.
You can make partial withdrawals from the PF account in the following circumstances:
|Reasons for withdrawal||Minimum number of years you should be employed|
|Home loan repayment||10 years|
|Purchase of land or purchase or construction of a house||5 years|
|House renovation||5 years|
|Partial withdrawal before retirement||The employee can withdraw 90% of the amount one year before retirement, provided they are at least 54 years old.|
The withdrawal limits are discussed below.
|Reasons for withdrawal||Withdrawal limit|
|Medical reasons||Six times your monthly basic salary or your total share plus interest, whichever is lower|
|Education||Up to 50% of contribution to the EPF account|
|Marriage||Up to 50% of contribution to the EPF account|
|Home loan repayment||The limit will be the lowest of the following:The total amount of your PF contribution with interestUp to 36 times the monthly basic salary and dearness allowance (DA)The total outstanding housing loan amount|
|Purchase of land or purchase or construction of a house||The maximum amount available for land is equivalent to 24 times the monthly basic salary and dearness allowance (DA), while the maximum amount for a house is equivalent to 36 times the monthly basic salary plus dearness allowance.|
|House renovation||The limit will be the lowest of the three:Up to 12 times the monthly wages and dearness allowance (DA)Your contribution to the EPF account with interestThe the total cost|
|Partial withdrawal before retirement||Up to 90% of the total amount with interest|
Step 1: Go to the EPFO portal
Step 2: Select ‘For Employees’ from the drop-down list under the ‘Our Services’ tab
Step 3: Choose ‘Know Your Claim Status’
Step 4: Enter your UAN
Step 5: Input the Captcha code
Step 6: Fill in the required details, such as the state of the PF office, establishment code, respective PF office, and Provident Fund number
Step 7: Click on ‘Submit’ to check your EPF withdrawal status
When an employee withdraws funds from their EPF account, the amount may be subject to tax based on the duration they have worked for their employer at the time of withdrawal.
The table below highlights the Tax Deducted at Source (TDS) applicable to different scenarios of EPF withdrawal.
|When, at the time of withdrawal, your PF account has less than ₹50,000||No TDS is deducted|
|When you withdraw the EPF amount without completing 5 years at the particular organisation||10% of TDS if you furnish the PAN cardTDS at the rate of 34.6% will be deducted from the EPF amount withdrawn if the PAN card is not furnished.|
|When you withdraw the EPF amount after completing 5 years of continued service||No TDS is deducted|
Under Section 80C, an employee’s contribution to their EPF account is eligible for deductions, subject to a maximum limit of ₹1.5 lakhs.
Employer contributions to an employee’s EPF account are exempt up to 12% of the PF amount. However, from April 1st, 2020, any employer contributions to Provident Fund (PF), National Pension Scheme (NPS), and superannuation above ₹7.5 lakhs per year are taxable under the ‘Income from Salary’ head.
Starting April 1st, 2022, interest earned on an employee’s contribution to their EPF account is tax-free up to ₹2.5 lakhs per year. Any interest earned on a contribution exceeding ₹2.5 lakhs is taxable for the employee. The threshold of ₹2.5 lakhs will increase to ₹5 lakhs if the employer does not contribute towards the EPF.
If you withdraw money from your EPF account, it will be considered as income. Therefore, you must select the option ‘Recognised Provident Fund Section 10(12)’ while filing your ITR to declare this amount.
Withdrawing your PF amount can be straightforward if you follow the steps outlined in this guide on how to withdraw the PF amount. By ensuring that you meet the eligibility criteria and have the necessary documents at hand, you can easily initiate your withdrawal request through the EPFO portal. Remember to update your bank account details to ensure a smooth and timely transfer of funds.
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Yes, you can withdraw your full EPF amount only when you retire or have been unemployed for over two months.
Yes, you can withdraw from the EPF account without providing your PAN card. However, when you furnish your PAN card, the TDS applicable to the amount withdrawn is 10%, while it’s 34.6% in the absence of the PAN card.
Yes, the amount you contribute towards the EPF account is eligible for tax deductions for up to ₹1.5 lakh under Section 80C of the Income Tax Act.
According to the new EPF rules, you can withdraw the EPF amount without your employer’s permission.
Your claim for EPF can be settled within 20 to 30 days.
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