An employee provident fund (EPF) also known as the provident fund (PF) is a mandatory saving or retirement scheme for employees of a particular organization. EPF is optional for those employees who earn less than ₹15000 per month; it is mandatory for those who earn more than ₹15000 per month.
Employees often withdraw money or do not transfer their PF from their previous employer to a recent one for tax savings while switching jobs. They may continue the same PF account and withdraw the entire amount at the time of retirement.
As per the EPF policy, employees will contribute 12.5% of their basic pay every month to this fund and the employer contributes the same amount to it. A specific interest is credited to Employee provident fund accounts on an annual basis.
In this blog, we are sharing the definition of the Employee Provident Fund and the timing, and process for EPF withdrawal online and offline.
What is PF (Provident fund)?
Every month during payroll, a part (say 12.5 per cent) of an employee’s basic salary and a similar amount from the employer’s account to gets deducted in the name of EPF. At the end of the financial year, employers need to share the PF statement as received from the EPFO.
EPFO is the organizing body of employee provident funds and handles claims and withdrawals. The EPFO is entirely responsible for the whole PF process.
What Time is Beneficial for EPF(the Employees Provident Fund) Withdrawal?
Before applying for EPF withdrawal, it is essential to know the benefit Employees can choose either of two ways of EPF withdrawal. One is complete withdrawal and the other is partial withdrawal.
EPF can be entirely withdrawn under the following circumstances,
▸After the individual’s retirement
If an employee retires from the service at the age of 58, he can withdraw the entire complete amount from his EPF pension fund. He can also claim the EPS (Employee pension scheme) amount at the same time.
▸After the individual becomes unemployed
It is also known as partial EPF withdrawal. PF will be available if an employee retires from work in mid-age and remain unemployed for straight two months (60 days). He/ she can withdraw the entire amount after completion of 2 months of the last working day.
If your individual’s PF account exceeds 10 years of his/hers service, then only the EPF amount cannot be withdrawn. Individuals have to take the EPF along with EPS cause then they will be under the pension benefit scheme.
Different scenarios of partial Employees provident fund withdrawal
Here are different scenarios for EPF withdrawal
Limit of EPF withdrawal Six times the monthly basic salary, or the total employee’s share plus interest.
The limit of EPF withdrawal is up to 50% of the employee’s share of contribution to EPF. In this scenario, the Amount can be withdrawn by individuals who must have a minimum of 7 years of service periods. This withdrawal is limited to the marriage of self, son/daughter, and brother/sister.
This scenario ensures up to 50% of the employee’s share of contribution to EPF. But the individuals must have 7 years of experience and can use the PF amount either for the account holder’s education or the child’s education (post-matriculation).
You can purchase land or purchase/construct a house using the EPF withdrawal amount. For land Up to 24 times of monthly basic salary plus dearness allowance and for the house, the withdrawal amount is up to 36 times of monthly basic salary plus dearness allowance. You should have 5 years of experience by yourself or jointly with your spouse.
Limitation for EPF withdrawal for real estate
- It can be withdrawn just once during the entire service period.
- The construction should already be begun or start to build within 6 months and must be completed within 1 year from the last withdrawn instalment.
▸Home loan repayment
Your EPF withdrawal amount up to 36 times of monthly basic salary with dearness allowance, or total corpus consisting of employer and employee’s contribution with interest, or the complete outstanding principal and interest on the housing loan purpose.
For withdrawal, you must have a minimum of 10 years of service period. And additionally, you can register by your own name or spouse or jointly with the spouse.
You can withdraw up to 12 times the monthly wages and dearness allowance for home renovation purposes. For the withdrawal, you must have a minimum of 5 years of service periods. For home renovation, the property should be registered in the name of the employee or spouse or both.
Importance of Aadhar card EPF Withdrawal:
You can withdraw PF (Provident Fund) and EPS (Employees Provident Fund) amounts either by using your Aadhaar card number or without using your Aadhaar card.
Using an Aadhar card, you can complete the entire withdrawal procedure simply in time. Without using Aadhar you can continue the withdrawal process but it becomes time-consuming.
▸Without using Aadhaar Card:
Once any individual does not hold an Aadhaar card, but has the PF number he has to fill Composite Claim Form (Non-Aadhaar).
If in case you are not completed 5 years then you have to fill in all the details like PAN (Permanent Account Number) along with attaching 2 copies of form 15G or 15H.
▸With using Aadhaar card:
In case an individual holds an Aadhaar Card, you can submit a Composite Claim Form aadhaar directly to the EPFO office without filling up the claim form from your employer.
What you have to do is just attach a cancelled cheque with the form. The complete balance amount will send to the bank account.
Conditions for EPF Withdrawal
What is the condition that you should meet before applying for the EPF withdrawal? Here is a list of the condition of EPF withdrawal.
- The entire amount from the EPF account will be withdrawn only after retirement. EPFO considers early retirement on and after 55 years of age.
- Partial withdrawal of EPF is permitted during medical emergencies, educational emergencies, house purchase or construction, and renovation.
- The Composite Claim Form EPF has now replaced EPF withdrawal Form 31
- Employee Provident Fund Organisation allows EPF withdrawal of at most 90% of the amount 1 year before retirement.
- Individuals withdraw the EPF corpus if they face unemployment before retirement
- Employees do not need to wait for approval from their employer for withdrawing their EPF.
- Employees can link UAN and Aadhar to their EPF account, they can get the approval online on time.
The following documents are required while applying for PF withdrawal-
- Bank account statement
- Composite Claim Form
- Two revenue stamps
- Identity proof
- Address proof
- One blank and cancelled cheque with a bank account number and IFSC code
How To Withdraw Your PF Amount Online and Offline
If you are thinking about how to withdraw your pf online or offline, you can go through the following process.
- Physical application
- Online application
▸Online PF withdrawal process
Online EPF (Employee Provident Fund) withdrawal is a process that allows employees to withdraw funds from their EPF account online, without the need for physical forms and documents.
The EPF is a retirement savings scheme established by the government of India, which requires both employers and employees to contribute to the fund.
The EPF withdrawal process has traditionally been a time-consuming and cumbersome process, requiring employees to fill out multiple forms and submit them physically to the EPF office.
However, with the advent of online services, employees can now withdraw their EPF funds online, which is faster, more convenient, and more secure.
There are certain conditions on online PF claims. The savings cannot be availed directly without satisfying any of the conditions below:
How to withdraw PF online with UAN?
Before withdrawing your EPF account ensure that-
Prerequisites for online withdrawal
▸One, Your UAN (Universal account number) is activated
▸Two, Your AADHAAR number is linked with UAN
▸Three, Correct bank details are seeded with UAN
▸Four, KYC is done
▸Five, the Mobile number is linked and working
▸Six, Correct date of birth (DOB) is seeded
How to withdraw pf online
Below are steps to claim PF online:
Step 1: Visit UAN portal
Step 2: Enter your UAN number and password.
Step 3: After logging in, click on the tab ‘Manage’ and select KYC to check whether your KYC details are correct and verified or not.
Step 4: After the verification process, go to the tab ‘Online Services’ and select the option ‘Claim’ from the drop-down menu.
Step 5: Now the ‘Claim’ screen will display member and other service details. Click on the tab ‘Proceed for Online Claim’ to submit your claim form.
Step 6: Select the claim you require i.e. full EPF Settlement, EPF Part withdrawal (loan/advance) or pension withdrawal, under the tab ‘I Want to Apply For’. If the member is not eligible for any of the services like PF withdrawal or pension withdrawal, then that particular option will not appear in the drop-down menu.
Step 8: Once the reason for withdrawal/ advance is selected, you will be required to enter your residential details. The individual will now be required to upload the scanned copy of the cheque/ passbook. Select the terms and conditions once again. Click on ‘Get Aadhaar OTP’.
Step 9: A one-time password (OTP) will be sent to your mobile number registered with Aadhaar. Enter the OTP in the required box.
Once the OTP is entered successfully, your PF withdrawal process will end. That’s it!
How to withdraw PF offline with UAN?
Offline EPF approval refers to the traditional method of getting an EPF withdrawal approved, where employees need to submit physical forms and documents to the EPF office for processing.
Although online EPF withdrawal has made the process more convenient and faster, employees can still opt for offline EPF approval if they prefer to submit physical documents or if they face technical issues with the online process.
Withdrawing your PF offline, you have to visit the respective EPFO office and submit a duly filled Composite Claim Form PF. You can fill out two types of Composite Claim Forms- Aadhaar and Non-Aadhaar.
The Aadhaar Form is direct and does not require any signature from the employer. In the case of the Non-Aadhaar Form, what you will have to do is get a signature from your employer before submitting it to the jurisdictional EPFO office.
Earlier, you had to fill the form like Form 19, Form 31. However, these all forms are replaced with a single EPF withdrawal form – the Composite Claim Form, the purpose of all three forms.
In conclusion, online EPF withdrawal is a convenient and efficient process that allows employees to withdraw funds from their EPF accounts without the need for physical forms and documents. It saves time and effort for both employees and the EPF office, while also ensuring the security and integrity of the EPF funds.
The online EPF withdrawal process involves logging in to the EPF website, checking eligibility, filling out the withdrawal form online, and submitting it electronically. Employees can also track the status of their EPF withdrawal online, using their UAN and password.
However, employees can still opt for offline EPF approval if they prefer physical forms and documents or if they face technical issues with the online process. The offline EPF approval process involves filling out the withdrawal form, submitting it along with supporting documents to the nearest EPF office, and waiting for verification and processing.
Overall, whether employees choose online or offline EPF approval, it’s important for them to ensure that they fill out the forms accurately, provide all necessary documents, and follow the guidelines and eligibility criteria set by the EPF office, in order to ensure a smooth and successful withdrawal process.
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