Latest EPFO Rules: You Can Withdraw This Much Money from Provident Fund Account; Read Method & Income Tax Details

As per the latest EPFO rules, people who have been terminated from their jobs will be allowed to make a withdrawal of 75% of their accumulated corpus after 1 month from the date of termination.

Latest EPFO Rules: You Can Withdraw This Much Money from Provident Fund Account; Read Method & Income Tax Details
Provident Fund Rules

The Employees' Provident Fund Organisation or EPFO allows subscribers to withdraw money from their PF account prematurely. It can be done for various reasons like medical requirements, educational needs, house construction etc. EPFO also allows subscribers who have become unemployed, to withdraw funds from their PF accounts. 

What are the PF Withdrawal rules if you are unemployed?

According to the latest EPFO rules, people who have been terminated from their jobs will be allowed to make a withdrawal of 75% of their accumulated corpus after 1 month from the date of termination. However before, one was not permitted to make a withdrawal post one month. If the individual remains unemployed for a period of 2 months or more, they are allowed to withdraw the remaining 25% & settle the PF amount completely. 

In other words, an unemployed person can withdraw 100% of their PF money after two months of being jobless.

Documents required:

EPF account holders must not submit any unemployment-related documents to the EPFO to withdraw the amount as the pause in EPF deposits is a sign of unemployment. The advantage of not withdrawing 100% amount helps your PF account membership to remain intact. Thus, allowing you to transfer your remaining balance to a new employer. Also, if your account remains active, you can draw a pension at the time of retirement.

Withdrawal Rules of women getting married:

If you are jobless for two months, then you can withdraw your entire PF corpus & close your EPF account. As per an EPFO order, the requirement of 2 months of waiting period is not applied to women who resign from their job to get married.

Withdrawal Rules of subscribers above 54 years of age:

These subscribers are allowed to withdraw up to 90% of their PF balance at any time after crossing 54 years but within one year of retirement on superannuation, whichever is later.

Provident Fund 

 

How much income tax on PF withdrawal?

For EPF withdrawal after 5 years of continuous service, the amount withdrawn (both principal and interest) is exempt from tax. If the withdrawal happens before completion of 5 years of continuous service, it is fully taxable. But, if withdrawal is made before 5 years due to the ill health of the employee or discontinued business of the employer or for any other reason beyond the control of the employer is also exempt from tax.

Method to withdraw money from EPF account:

You can file a withdrawal claim by using your UAN on the EPFO portal. First, make sure that the UAN has been activated & also the bank details plus KYC documentation on the PF portal.

Step 1: Log in to EPFO's unified portal by your UAN and password.
Step 2: On the ‘Our Services’ tab, choose the ‘Claim’ option from the drop-down list.
Step 3: There will be three types of withdrawal claim, i.e. full withdrawal, partial withdrawal, or pension withdrawal — in ‘I Want to Apply For’ section. However, the drop-down box with types of withdrawal will be available only if you are eligible to avail it.
Step 4: Once it is approved, the PF amount will be credited directly to your bank account.