WHAT HAPPENS TO YOUR PF AFTER LEAVING JOB ?

There are multiple scenarios for PF depending on the amount and years of service in your company. Companies provide Employee Provident Fund to their employees which is funded by directly deducting some amount you’re their salary. Employees’ Provident Fund (EPF) or popularly known as PF is a fund which provides financial support and assurance post retirement. Employees who have given their few or more years of service to the corporation can withdraw their EPF amount but depending on multiple scenarios, not every time the withdrawn is possible.

There are a few rules that you should remember to avail all the benefits from your EPF account. Employees need to be very careful while leaving the job and if you are retiring before 58 years. In several cases, employees forget to transfer their EPF account after switching jobs. Several employees also feel that the EPF balance will get tax-free interest while leaving the job before the age of 58. However this is not the case and people should research about the existing benefits for their EPF.

Salaried class should remember that their EPF accounts remain operative. Employees’ Provident Fund Organisation (EPFO), the nodal body for EPF account, has laid down a few situations in which a PF account can become inoperative under the following circumstances.

If a salaried employee retires from service after 55 years and he or she does not withdraw the money from the account three years after the retirement.

  1. If the EPF account holder migrates abroad permanently.

2. If the EPF account holder passes away.

3. If the EPF account holder doesn’t make any claim after 36 months of quitting the job.

In all these situations, the EPF account cannot give the required benefits.

But now, Let’s look at the number of possibilities to avail EPF benefits under different conditions.

Can I take my PF amount if I have worked only 2 months in a company?

Yes, The PF deposited in your account by your employer belongs to the employee and irrespective of your tenure, you’re entitled for your EPF amount. You can either get It transferred or withdraw after 2 months of unemployment as per your convenience.  

Will my EPF amount earn interest after leaving job?

Even if there is a fresh contribution or not, your EPF amount is eligible to receive interest after leaving the employment. However, no benefits can be availed if subscriber cannot claim for it for 36 months after leaving the job.

Can I withdraw my PF before one year?

As per the new rules, you can withdraw some of the amount of your EPF under certain conditions, but to withdraw the full corpus, the subscriber must be at least 58-year old. If the subscriber is 54 years of age then he/she can withdraw 90 percent of their corpus in case of running employment.

Can I get my PF money if I quit my job?

You can claim both PF and EPS amount if you haven’t completed 10 years of service after filling the Composite Claim Form you can choose both the options among ‘Final PF balance’ as well as ‘pension withdrawal’. If you are planning to work again you can submit the Form 10C and get the ‘scheme certificate’.

Can I withdraw my PF immediately after resignation?

You cannot apply for withdrawal of EPF account balance immediately after your resignation from a company. If you chose to withdraw your money in the PF account before completion of 5 years, you will liable to pay tax on the amount.

How long do I need to wait to withdraw my PF amount?

If you’re unemployed for 60 days straight or 2 months then you can withdraw your full PF amount. Under the existing rule, employees who resign from a job before they turn 58 years of age can withdraw the full PF balance (and the EPS amount depending on the years of service).

Is the interest on my EPF amount taxable?

According to the Income Tax rules, interest on your EPF account becomes taxable if you withdraw any amount before completion of five years “continuous service”. If an employee works at multiple organisations in the initial five years, then service rendered to those organisations will be considered as ‘continuous’ if you transfer the EPF account to the next organisation.

Can I withdraw PF while I’m switching my job?

It is advised to transfer your EPF amount rather than withdrawing the money when you switch jobs. Make sure that your PF accounts of all the organisations you worked for are linked to a single UAN number. This will make your task easier and sorted. You can withdraw your EPF amount if your new organisation do not provide you an EPF facility or you voluntarily wants to opt out of it.  

Can I take loan from my PF?

Any individual having a PF account is eligible to withdraw funds from his/her EPF account as loan towards repairing and buying a house. To avail this benefit, employee should be in service for 5 years in the organisation to be eligible to get loan against PF.

Can I withdraw my PF multiple times?

There is no limit as to how many times you are allowed to apply for an advance withdrawal, as long as there is balance in your EPF, you can opt for it. The number of times you can apply for this kind of withdrawal depends on various conditions. If you’re filling the criteria for early withdraw, you can avail an early extraction of your PF. The various conditions are: marriage, medical treatment, education, home loan repayment, house repair or alteration, purchase/construction of house and lockout etc.

Following are the things you should remember

Always transfer your EPF account to the next organisation immediately after changing the job.

If you have multiple PF accounts then you must ensure that those accounts are linked to a single UAN number.

If you are retiring before the age of 58 years, you must withdraw the PF amount within 36 months of retiring.

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