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Provident Fund (PF) or the Employees’ Provident Fund (EPF) as it is officially known, is a type of long-term investment plan in which funds are contributed by an employee or employer and in special cases, by the government. EPF is almost similar to a pension, as it is a government-regulated social security program aimed at protecting the life of workers after retirement. The invested amount, inclusive of the interest accumulated is paid out when an employee retires from service. Withdrawal of this EPF is not just a simple process; there are rules to be adhered to for the process to be possible.
There are three types of PF withdrawals listed out to members who have subscribed to EPFO and have seeded their Aadhar card details with their UAN:
Withdrawing EPF is easier these days, more so with the advent of new technologies introducing a faster and secure way to do so. EPF withdrawal process can be carried out online, which is the easiest and fastest way to submit PF withdrawal forms. This earlier used to be a cumbersome and excruciating process.
The EPFO introduced a single-page Composite Claim Form to replace the traditional, cumbersome multiple claim forms i.e., Form 19, Form 10C, and Form 31. Before making an online claim for PF withdrawal, there are key points to consider:
This process provides relief to the employee, as they are not required to seek attestation from their employers, but only if you have met the aforementioned conditions. Since the withdrawal process is a direct submission, without being routed to the employer, the processing time is thus quicker in comparison to the physical method.
You can also submit your PF withdrawal forms physically. The EPFO updated EPF withdrawal rules indicate the following steps:
The PF amount successfully withdrawn will then be credited to your bank account. This process is quite long and tedious, and cannot be tracked as compared to the online procedure.
Before EPFO made the much required update, three EPF withdrawal forms were commonly employed when filing a withdrawal.
This is applicable for partial PF withdrawal when a member seeks to meet emergency engagements during the employment period. It is also applicable if you are withdrawing on the basis of unemployment. The withdrawal limit allowed and total funds accumulated on the member’s PF account determines the amount approved once you fill the Claim Form 31. The reason for filing this form must be indicated clearly for the form to be processed.
A final PF settlement, where the entire PF amount at the time of retirement is withdrawn. You’ll have to fill the respective details, i.e., personal details, employment details, when you started your employment, termination of employment date and reason for termination, bank account details, physical address, UAN, PAN card details, Aadhar number, etc.
Form 10C is a form for withdrawing the pension amount. On grounds of unemployment, Form 10C should be filled. It is quite similar to Form 19 with the only difference being that the Employees’ Pension Scheme -1950 regulates the pension amount to be withdrawn, whilst the Employees’ Provident Fund Scheme -1952 regulates the PF amount.
This single-paged PF withdrawal form was introduced to accommodate all the three aforementioned forms when applying for the withdrawal online.
Under the stipulated EPFO guidelines on eligibility, the following are acceptable terms for PF withdrawal:
If the employee, still under service, wishes to withdraw an advance, Form 31 (if offline) or the Composite claim (if online) has to be duly filled and submitted accordingly. Within 10 years of eligible service, a composite claim form can be submitted. If 10 years have passed, the member can request for monthly pension deductions by filling the Form 10D.
If the employee has crossed 58 years of age, while still under service, and desires to claim the Pension Fund, he/she should fill Form 10C accordingly and submit it.
When an employee switches jobs and wishes to transfer PF funds to a new account, they ought to fill Form 13. When they leave an establishment and don’t join another, i.e., become unemployed, a PF withdrawal claim can be made by filling a composite claim form. If a person is above the age of 58, and has completed 10 years of eligible service, they can make a PF withdrawal claim by filling a composite claim and a Pension withdrawal claim using Form 10C or Form 10D (in case of monthly pension payments).
If an employee leaves an establishment as a result of physical disability, a PF claim can be made by filling a composite claim form. Moreover, with a Form 10C/10D, they can make a pension claim.
If they have not completed 10 years of service, but are over 58 years of age, he/she is eligible to make a PF and Pension claim by filling a composite claim form.
If an employee is deceased while still in service, or after the age of 58 plus 10 years of eligible service, their beneficiary can fill Form 20, to apply for the PF settlement and a monthly pension by filling the Form 10C/10D form. In addition, they can also fill the Form 51F for the EDLI (Employees’ Deposit Linked Insurance).
If the deceased employee had achieved the age of 58, but had not completed the 10 years of eligible service, their beneficiary can make a settlement with Form 20, and additionally, withdraw the pension with a composite claim form and EDLI with Form 51F.
If the deceased was over 58 years of age and had fulfilled 10 years of eligible service, the beneficiary may claim PF with Form 20 and pension with Form 10C/10D. If the deceased had not completed the 10 years eligible service, his/her beneficiary can apply for a PF settlement with Form 20 and pension fund with a composite claim form.
Employees can make partial withdrawals based on certain circumstances. Listed below are the withdrawal purpose, eligibility for withdrawal, withdrawal limit and the relations applicable.
A member can make up to 50% withdrawal of the PF to fund their marriage, or the marriage of immediate family members, i.e., son, daughter, sister, or brother. However, the eligibility for the withdrawal dictates that the person should have contributed continuously to the scheme for seven years.
Members can withdraw money to cover their son or daughter’s education, albeit under certain conditions. The member must have completed a seven-year membership period at the EPFO.
Members can withdraw money with the aim of constructing or purchasing a house. However, they must have completed a five-year EPFO membership.
Members can partially withdraw PF when their house is in need of renovation. This can be applicable in two instances: if it has been five years or ten years since the last renovation.
Partial withdrawal can be made for medical emergencies and is applicable to spouse, children and self. Fortunately, there is no lock-in period for one to be eligible for this partial withdrawal reason.
To repay a home loan, the member is allowed to make a partial withdrawal of the PF. However, they ought to have completed at least 10 years of service.
Online PF withdrawal is only made possible if you have adhered to the aforementioned rules. To initiate a PF withdrawal claim online, follow these guidelines:
Can I withdraw my PF while working?
EPF is a long-term investment towards building a financially stable retirement. Therefore, it doesn’t allow members to withdraw their balances while working.
Can I withdraw my PF before 5 years?
Yes, it is possible to withdraw your PF before 5 years have elapsed; however, you should note that the amount withdrawn is liable to taxation.
How much PF can be withdrawn?
The amount depends on the scenario involved. Partial withdrawals only withdraw a certain amount while after retirement, full PF withdrawals can be made.
Can I withdraw full PF amount?
You can withdraw full PF amount once you are of retirement age or well beyond 58 years of age. A beneficiary can also withdraw full PF amount in case of a deceased benefactor.