Employees’ Provident Fund (abbreviated as EPF) is a popular retirement savings scheme for all employees in India – either on a mandatory or a voluntary basis. It falls under the aegis of the Employees Provident Fund Organisation (EPFO), a statutory body. It periodically reviews the PF withdrawal rules to make the process more seamless and improve the experience of its million+ subscribers. Typically, online PF withdrawal could take up to 3 working days and the offline process could take up to 20 working days. Let us now look at the rules for 2023.
Planning to withdraw a portion of your PF corpus? Well, here are some basic rules you need to be aware of:
You can withdraw PF, provided you satisfy some conditions. Here are some reasons for which you can withdraw your PF funds:
A PF account holder can withdraw up to 50% of their total contribution to their Employee Provident Fund (only the employee’s contribution). You can use this amount to pay for the education of your children after class 10 as well as for your own higher education.
You can withdraw this money at any time during your service period. For this, you do not need to complete a number of years of service in your present organisation. The maximum amount that you can withdraw is your six months’ salary. This amount can be used for medical treatment of self or family.
You can withdraw an amount equivalent to 12 times your monthly salary from your EPF to repay your existing home loan. However, you will have to complete 5 years of continuous service in order to be eligible.
The amount can be used to repay your present home loan or purchase a property or house. In order to avail the loan, the house must be in your name, your spouse’s name, or owned jointly. This benefit cannot be availed if this is not the case.
Any PF account holder can withdraw 75% of the accumulated amount if they have been unemployed for more than a month after relinquishing employment. If the unemployment period exceeds 2 months, the remaining 25% can also be withdrawn.
Some other reasons for withdrawal might be:
Due to natural calamities or cuts in electricity in the establishment or for investing in Varishtha Pension Bima Yojana.
You can opt to withdraw money from your EPF account to meet the necessary expenses for your wedding, wedding of a child, or wedding of a sibling. However, you can avail this benefit if you have completed at least seven years of continuous service. Up to 50% of the amount you have contributed towards your EPF account, and the interest accumulated can be utilised for a maximum of three times.
According to PF withdrawal rules 2023, specially-abled account holders are eligible to withdraw 6 months’ basic salary and dearness allowance or the employee’s share of contribution along with interest, whichever is lower, to pay for their equipment.
On the EPFO member portal, you can complete three different types of PF withdrawals:
To conduct any of the above mentioned activities, you will need the approval i.e. attestation of your employer. But make sure that your Aadhaar card is linked to your UAN.
For the members, who have an EPF account and have linked their Aadhaar card details with the Universal Account Number (UAN) can avail PF withdrawals in three ways:
This type of PF settlement is done when you have reached retirement age and your service life has ended. If the account holder has passed away, the nominee would receive the payment.
This type of payment withdrawal takes place when you withdraw only a portion of the PF corpus so as to fulfil your financial requirement.
If you continuously provide your services to the organisation for 10 years, you are eligible to receive pension benefits after retirement.
The withdrawal types mentioned above are possible from the EPFO member portal with the attestation of their employer.
EPFO continues to make the PF withdrawal rules simpler with the sole objective of enhancing the experience of its subscribers. The time for EPF withdrawal has also been considerably reduced in the recent past.
But wait! Do you really need to withdraw your PF funds prematurely? A much simpler alternative could be Navi Instant Cash Loan, with which you can get up to ₹20 Lakh to meet any planned or unplanned expense, at attractive interest rates as low as 9.9% p.a. Download the Navi App today to check your eligibility and apply.
Yes, there is a portal offered by EPFO for grievance redressal. It is called the EPF i Grievance Management System. To know how to register your grievance, click here.
Based on when you plan to withdraw your PF funds and the reason for which you plan to use it, there could be a limit. Scroll up to read the various reasons for which you may be able to use your EPF balance.
Section 80C of the Income Tax Act offers tax deductions of up to Rs. 1.5 lakh on contributions made to Provident Fund. However, only the employee’s contribution to PF is eligible for deductions. Thus, there is no tax benefit on the employer’s contribution.
If you are withdrawing your PF balance online, you do not have to ask or inform your employer. Earlier, you had to get your employer’s signature on Form 19. However, with the introduction of UAN-based Form 19, you can now submit all forms for PF withdrawal without the employer’s signature.
To download and print PF passbook online, you need to visit the member passbook page on EPFO’s official website. Upon logging in using your UAN and password, you can see a dropdown menu with all PF accounts linked with the UAN. Select the specific Member ID and click on ‘View Passbook.’ Lastly, you can scroll down to download or print the passbook.
Public Provident Fund and Employee Provident Fund are retirement schemes with the aim of ensuring income security after retirement. There are different rules in relation to EPF, as only salaried individuals can hold an account and have a lock-in period till retirement. Meanwhile, PPF is open for all and has a shorter lock-in period. Traditionally, the EPF interest rate is higher than PPF.
For the financial year 2020-21, the EPFO offered an 8.5% interest rate to its subscribers. Meanwhile, the interest rate on EPF contributions for FY 21-22 has been reduced to 8.1%, which is the lowest in over 4 decades.
|Section 194IB||Section 44AA||Section 80E|
|Section 195||Section 80EEA||Section 80DD|
|Section 80CCC||Section 80GG||Section 80 G|
|Section 54F||Section 1941A||Section 10|
|Section 194Q||Section 192||Section 269SS|
|Section 80DDB||Section 44AD||Section 194C|
|Section 194A||Section 194H||Section 80D|
|Section 80C||Section 80C, 24(b), 80EE & 80EEA||Section 234A|
|Section 50C||Section 80C||Section 80EEA|
|Section 194B||Section 194J||Section 206C|
|Section 80CCG||Section 80 EEB||Section 24Q|
|Section 40b||Section 194C||Section 54EC|
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