Unless, you are working in the government sector, your retirement savings/pension is your responsibility. The rise in the number of people employed in the private sector has seen an increase in the adoption of the Employee Provident Fund (EPF), which is a reliable and popular choice for future retirement and pension savings. Read this guide to know about the wide range of benefits, withdrawal procedure and checking your balance.
EPF is a well-known abbreviation of the term ‘Employee Provident Fund’. The Employee Provident Fund is the Indian Government’s social security initiative. EPF is interchangeably used as PF. EPF is a savings scheme, which mostly falls under retirement benefit scheme, which can be availed by all salaried employees.
Each month, the equal contribution of employer and employee, which is 12% of basic salary each, is deposited into a provident fund account. Contribution to provident fund is compulsory for the employers drawing up to INR 15,000 per month. Employees earning more than INR `15,000 per month can opt for the membership of provident fund.
The break-up of employer’s contribution of 12% is as follows:
• 3.67% is contributed to provident fund
• 8.33% is deposited in pension scheme
It’s essential to note that if your basic salary (wage pay) is more than INR 15,000 per month, your employer contributes 8.33% of INR15,000 (i.e. INR 1,250) to your EPS and the remaining amount of 3.67% gets credited into your EPF account.
PF is maintained and administered by the Employees Provident Fund Organisation of India (EPFO). According to the 1952 Act, any company with over 20 employees is required to register with the EPFO.
The PF number format is specific comprising of the following; Region/ Office/ Establishment Code/ Ext/ PF Number
Note: If 3-digit extension number is not available, you need to put it as ‘000’
Sample PF Account Number:
Example 1: MH/BAN/54321/2327999
Example 2: MH/BAN/54321/000/2327999
The fields that form the PF account number are identifiers for the region, the employer and the employee. Here, the PF account number symbolizes as follows:
|BAN||Bandra EPF office|
|54321||Five digit code is employer /establishment of your organisation|
|2327999||Seven digit number of your actual PF account|
|‘000’||Information regarding the region where the PF is held|
UAN is an abbreviated term of Universal Account Number. It is a 12-digit unique number given to every PF account holder. The EPFO allocates a UAN to everyone having a PF account. An account holder can access, verify, and withdraw from his/her Provident Fund account without any interference from his/her employer with his/her UAN number. UAN facilitates linking of multiple EPF accounts of a member. Aadhaar card enabled UAN will allow members to directly access EPF services.
If your UAN number is not on your salary slip, get it from your employer and check to see if it is activated on the portal. To generate your UAN you need to visit site and submit your KYC. After receiving your OTP on your registered mobile number, your UAN will get activated. Upon activation you can edit your KYC details and password.
[ Read: How to Register and Activate UAN Number ]
It is advisable to check your EPF balance regularly since it is your disciplinary retirementsavings scheme which has been jointly build up by you and your employer. There are multiple ways you can check your EPF balance. You can check your balance through missed call, SMS, mobile app, and other ways. Downloading e-passbook is also possible.
SMS facility is available in 10 languages including English and Hindi. Other languages are Telugu, Punjabi, Gujarati, Malayalam, Marathi, Tamil, Kannada, and Bengali. This SMS contains all basic details like PF number, Name, Date of Birth, EPF balance, and Last Contribution
To check your EPF balance, you need to fulfil the below mentioned requirements:
Note: Try intermittently if you face any difficulties on the site.
After registering online, you can access and download your EPF passbooks and slips multiple times from either your EPFO mobile app or UAN portal. Your EPF passbook is like your bank passbook.
You can download the passbook by following these steps:
OR you can directly click on: https://passbook.epfindia.gov.in/MemberPassBook/Login.jsp
Your passbook comprises of the following details:
To download your passbook, you need to remember your activated UAN number and password.
The Unified Mobile App For New Governance (UMANG), which can be download from Google Play Store, allows employees to access their account details to make withdrawal requests with the app. For making requests, your Aadhaar number and UAN need to be linked, however to view your passbook, Aadhaar is not necessary.
Aadhaar card is now considered as the most valid source of identification in the country. Linking of your Aadhaar card to your UAN enables you to easily make withdrawals, transfers and other procedures without the verification of employers.
When it comes to withdrawal from your PF account, your EPF account number is the most important thing for withdrawal application
For all new EPF accounts, it is now mandatory to link Aadhaar card with EPFO and UAN.
You need to have a scanned and self-attested copy of Aadhaar card to link it with your UAN and EPF account. This scanned document must be in the format of .jpg/.gif/.png/.pdf and size should not exceed 300 KB.
You can avail of the following benefits by contributing to your EPF:
To better understand your tax savings options, consult your personal tax expert at H&R Block India.
At the start of every year i.e. 1 April, your opening balance on EPF account is considered for calculating interest. The Employees Provident Fund Organisation (EPFO) has reduced the interest rate on provident fund deposits to 8.55% for 2017-18 from the former 8.65%.
Your opening balance for the next year would be:
Add: Total monthly contributions
Add: Interest on the (old opening balance + contributions)
It means Compound interest in EPF is paid on the credit amount outstanding in the employee’s name as on 1 April every year.
A scheme available for salaried individuals to opt for, above the 12% contribution. You can opt for VPF by requesting your employer to deduct an additional percentage from your salary towards your PF, which has a wide of range benefits, including tax saving, as well as adding greatly to your retirement portfolio.
For transfers and withdrawal of your EPF, you will need to fill out the required form from the following list of forms, which can be found on the EPFO website:
You need Form no 19 for withdrawal of your EPF and Form no 10C for withdrawal of your EPS
According to old PF laws, you can only opt for entire withdrawal/transfer in case you change your job and get transferred to new employer’s PF account. Entire withdrawal is allowed only if you are unemployed for minimum 2 months.
Note: It has also been proposed that interest free partial withdrawals maybe allowed for account holder who are unemployed for longer than two months.
Based on the revised PF laws, you can also opt for PF withdrawal if you want to buy a house, repay home loan, require funds for kids’ marriage, kids’ education, and others as specified in the law. For withdrawal procedure, you need to fill up the new composite claim form wherein you need to correctly enter the details of UAN, date of joining/leaving, and purpose of withdrawal.
You need to select one reason, for the withdrawal, from the following:
Remember that if you have just one year left for retirement, you can withdraw 90 percent of your total PF balance and at that time you need not to submit any documents for the same.
You can withdraw your PF by
PF can also be withdrawn in the absence of your employer’s sign with and without Aadhar card.
Once your employer has verified your Aadhaar card and salary account details and furnished them in the EPFO’s member portal, your UAN should be activated. To withdraw your PF, fill out either form 19, 31 or 10c with your details such as name, PAN, mobile number etc. and attach a cancelled cheque, which the EPFO will verify. Submit the form and cheque to the nearest office. The bank information given should match the one listed in the UAN database.
The process of withdrawing your PF without your Aadhaar card can be a cumbersome process. You must fill out form 19, 31 or 10c and after filling in the required details, get it attested from reliable authority such as a magistrate, manager of the bank of your salary account or a member of the EPFO etc. Make sure the signatory authority stamps every page with his/her signature. You will also need to give your reason for withdrawal to avoid fraudulent withdrawal cases. Attach: indemnity bond with Rs 100 stamp paper, payslips, Form 19, Employee ID card, appointment letter and KYC documents (ID and address proof) to the EPF office.
Note:An EPF account where no contributions (no activity) have been received for 36 or more months continuously is considered as an ‘Inoperative EPF Account. For such users, the EPFO has created a helpdesk on its website to trace their inoperative accounts, which the member can get merged with the present account or withdraw the amount, as may be the case.
EPFO was earlier not paying any interest on this type of account. However, in November 2016, the law was revised, now such accounts are also credited with due interest at the rate of 8.55%.