In recent times, the dynamics of an employer-employee relationship has changed a lot. Retaining employees has become a difficult task for companies. The employees not only look out for their present status and growth, but also their future stability. Due to this, companies have started to provide various employee welfare schemes. Another reason for implementing such schemes is the rules and regulations of the country (India) in which a company is established. One of the employee welfare initiatives is the Provident Fund.
Another name for Provident Fund is Pension Fund. Contribution to this fund is made by the employer and employee. This amount can be claimed by the employee during the time of his or her retirement. A pre-decided part of the salary is transferred to the Provident Fund Account of the employee. This acts as a form of savings post the retirement.
Due to abundant growth opportunities, an employee keeps changing jobs more often. This results in the transfer of Provident Fund account from one employer to another.
A change in job gives an opportunity to the employee to withdraw the amount from the old Provident Fund account and open a new one. But given the tax scenario in our country, it is wiser to transfer the amount from the old fund to the new fund account. This is because any account closed within five years of its opening becomes taxable. The amount withdrawn within five years shall be liable to tax and will be considered as income.
Another advantage of transferring the old account in a new organization is that the EPFO provides interest on the amount lying in the provident fund. The other advantage is that partial withdrawal is allowed.
The following documents should be kept ready for the transfer:
Revised Form 13
Valid Photo ID Proof such as PAN, Aadhaar card or driving license.
Information such as personal details, UAN, current employer details – establishment number, account number, bank account details of the salary account, old and current PF account, have to be provided.
It is important that UAN is provided by the employer to the employee so as to facilitate easy transfer of funds online.
No duplicity of accounts
Personal details shall be extracted from aadhar card details feeded in the member portal
Funds can be transferred without the use of employee's DSC
Withdrawals will not require any attestation from the employeer
Leads to increase transparency in the system
A safety precaution that EPF has made mandatory is to nominate a beneficiary. In case of an account holder’s death, the nominee shall receive the funds. There is no restriction on changing the names of the nominee. The account holder shall nominate a member of the family. Any person outside the family shall be accepted as a nominee only if the account holder does not have a family.
The following steps have to be followed to make a nomination.
In the past, various problems and issues were faced by the employees regarding emergency withdrawals from PF accounts. Due to such increased complaints from the employees, EPFO has introduced a “Claim portal”. Any issue against the employer regarding Provident fund can be put up on this portal. The steps to be followed are:
If the need arises, employees are allowed to withdraw and transfer amounts from their Provident Fund accounts. A claim is to be raised for such withdrawal and transfers. The employer shall then approve or reject the claim raised by the employee. To check approval of such a raised claim, the mobile app is required. Other methods are through the EPFO’s member portal or by SMS. The procedure is as follows:
It is important for employees who have shifted to a new organization to fill and submit Form 13 to both organizations as the attestation of both the entities is required. In Form 13, an employee has to provide details of the old and new organization along with a request to close the old PF account and intimation of new PF account. The linking of UAN with all PF accounts will render the above procedure obsolete. Till then, in order to check the status of Form 13, the following procedure has to be followed:
Sometimes, in case of an emergency or roadblock situations in the life of an employee, there is no other way but to make withdrawal from the PF account. Withdrawing from PF accounts require approval from the employer who has the power to reject such claims raised in particular situations. To avoid such situations, linking of Aadhar card to PF account will be beneficial to the employee as the amount can be withdrawn without approvals.
Form 10C is required to initiate the withdrawal process. An employee can withdraw once approval from the employer is granted. The following procedure is for checking the status of Form 10C:
Various other schemes are organized by the EPFO along with the Provident Fund schemes. It has provided the employees to raise a pension fund for their retirement. Such pension funds will be created from their own provident fund account. If an employee is interested in such a scheme then he or she has to fill Form 10D. Post-filling up this form, it is the duty of the employee to check the status of Form 10D.
The procedure to be followed is:
Yes, registration on member portal is compulsory to transfer claim online.
No, editing of details such as father’s name, date of birth, date of joining and exit in the EPFO database is not allowed.
Yes, it is compulsory for the member to take a printout of the claim submitted online. The member shall give it to the employer after signing it.
The employee should approach the employer who has attested the form while submission.
The employee should submit the form within 15 days of its online submission.
