Pf or provident fund is a part of the employees salary which is deducted each month as part of savings. Employees usually claim pf amount once they resign from one organization to switch to another. Although there is the option to transfer a PF account from the previous employer to the new employer, employees tend to not opt for these options. The reason that can be stated behind this is the tax free returns earned by the employees and EPFO provides a secured platform to store employees hard-earned money. It is essential to note that the income tax appellate has intervened to exempt the tax free earnings after an employee quits his/her job. So this could be another reason an employee tends to withdraw the PF amount after resignation.
The next question that comes in the picture is
When can an employee withdraw the PF amount?
The PF amount is the contribution of the employee's salary and the employer paying a particular amount of the total salary of the employee. To gain a better understanding let’s take a look at the terms under the EPF act of 1952. The EPF act of 1952 states that an employee can withdraw the entire amount after completion of his/her job tenure at the age of 58. It even offered the employee to apply for a pension scheme or in simplified terms would be EPS amount, i.e employees pension scheme amount.
An employee who wishes to retire even before the age of 58 was entitled to EPF and EPS amounts. The condition to access this service under the EPF act of 1952, is that the employee has to complete a tenure of two months of unemployment. The employee can withdraw epf and eps amount by following a certain procedure. The procedure to withdraw PF and Epf is by filling the composites launched by the EPFO. EPFO is responsible to take care of your withdrawal. It is the responsibility of the EPFO team to take care of notifying the employees of the withdrawal procedure and take care of the withdrawal of the applicants.
Withdrawing of PF and EPS amount
There are two ways to withdraw PF and EPS amounts. The first procedure is by using the aadhar card and the second method is without aadhar card. Utilization of aadhar card for withdrawal makes it easier and a less time-consuming task for the employee. However, if the employee has to withdraw the amount without an aadhar card it becomes a tedious process.
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Let’s list both the process for convenience :
With the help of an aadhar card:
If an employee holds aadhar card. he/she needs to fill in the composite form and submit to EPFO for verification and proceeding further. It also requires the employee to attach a cancelled cheque for the withdrawal.
If an employee is to withdraw amount without an aadhar card:
Each employee is assigned a PF number. The employee can fill in the composite form using the PF number. However it is imperative to notice that if an employee has not completed five years of service, it might require him/her to add additional details such as PAN , i.e permanent account number and 2 passport photos.
If in case the employee lacks (universal account number )UAN number he/she has the option to go ahead with the provident fund account number and withdraw the amount without any hassle.
There are certain conditions that an employee needs to follow in various situations.
Having said that, it is essential to notice that the PF rules have been amended by the state and federal government for better utilization and convenience of the employees. It would be wise to follow up the EPFO page before signing for withdrawal of PF amount. As the recent changes may differ the contribution amount or even the procedure including the online PF withdrawal scheme. It has smoothen the employees life cycle and succeed to provide secured employment to various employees.
