PF Withdrawal: Step-by-Step guide to withdraw EPF money online
PF Withdrawal: Step-by-Step guide to withdraw EPF money online
- EPF is a long term investment vehicle through which salaried people can secure their old age
- Every month both employee and employer invest 12% of employee’s basic salary into the PF account
- If an individual withdraws PF after 5 years of continuous service, there are no tax implications
New Delhi: The Employees Provident Fund (EPF) is a mandatory saving and retirement scheme designed for salaried employees. As per the EPFO, the employee must contribute 12 per cent of their basic salary to this fund every month. The employer will also contribute the same amount every month.
The funds in the PF account gradually gains interest on an annual basis. This amount can be partially or fully withdrawn depending on a few conditions which have to be met. These can be career-wise or circumstantial situations.
PF withdrawal rules:
The amount in PF account can be withdrawn either completely or partially subject to certain terms and conditions. To withdraw the said amount completely, the individual needs to be either retired or unemployed for a period of more than two months. In these conditions onlu, the amount can be withdrawn completely pending an attestation from a gazetted office.
According to EPFO, individuals are eligible to withdraw provident fund balance in case of marriages of children, their higher education, repayment of home loans, emergent medical conditions, renovation of home, purchase or construction of a house, purchase of land and at a certain age before retirement.
Provident Fund (PF) partial withdrawal rules:
- Unemployment: According to the latest EPF rules, a person is allowed to withdraw up to 75 per cent of the total EPF balance on being unemployed for one month after quitting a job. The remaining 25 per cent of the EPF balance can be withdrawn if the person remains unemployed for over two months.
- Retirement: After attaining the age of 54 years and within one year of retirement/superannuation (whichever is earlier), a person is eligible to withdraw up to 90 per cent of the provident fund balance.
- Marriage/education of children: In case of monetary requirement for the purpose of marriages or post matriculation education of children, you can withdraw up to 50 per cent of the employee share with interest-only after completion of 7 years.
- Handicapped: In case of handicapped people, the EPFO body allows partial withdrawal from the EPF balance for purchasing equipment for minimising hardship on account of handicap. Under this, a person can withdraw six month’s basic wages and dearness allowance (DA) or employee share with interest or cost of equipment, whichever is the least.
- Illness: A person can apply for partial withdrawal from the EPF balance for the treatment of illness in certain cases. For self-usage or for the treatment of family members, EPFO allows a person to withdraw 6 month’s basic wages and DA or employee share with interest, whichever is the least.
- Loan repayment: For the repayment of home loan EMIs, an individual is eligible to withdraw 36 month’s basic wages and DA or total of employee and employer share with interest or total outstanding principal and interest, whichever is least, only after completing the 10-year membership period.
- Purchase of land/house: A person is allowed for premature partial withdrawal from the EPF account for purchasing land or house only after completion of five years as a member of EPFO. For the purpose of purchase of house/flat/construction of house including acquisition of site, an individual is allowed to withdraw the total of employee and employer share with interest or total cost or 24 month’s basic wages and DA (for purchase of site)/36 month’s basic wages and DA (for purchase of house/flat/construction), whichever is lower.
- House renovation: Interestingly, EPFO also has a provision of partial premature withdrawal for addition/alteration/improvement in the house owned by member/spouse/jointly with a spouse. Under this, a person can withdraw 12 month’s basic wages and DA or employee share with interest or cost, whichever is the least. This facility can be availed two times, first time, after five years of completion of the house and, for the second time, after 10 years from withdrawing the balance for the first time.
PF Withdrawal Online:
Step 1: Activate the Universal Account Number (UAN) and ensure that it is linked with a registered mobile number. Make sure that it is liked with your KYC, i.e., bank details, Aadhaar and IFSC code.
Step 2: Go to the UAN portal and log in with your UAN and password. Enter the captcha and proceed with signing in.
Step 3: Go to the ‘Online Services’ tab on the top, drop-down menu and click on the ‘Claim (Form-31, 19 & 10C)’ option.
Step 4: This will take you to a new page with all the member details, KYC details and so on. Fill out your bank account number and click on ‘Verify’. Then you need to fill in the reason for leaving the services of PF.
Step 5: A pop-up will appear named, ‘Certificate of Undertaking’. Click on ‘Yes’.
Step 6: Go to the drop-down menu again and select the ‘I Want To Apply For’ option and from there choose the ‘Only PF withdrawal (Form 19)’ option.
Step 7: Fill in the ‘Complete Address’ section and upload scanned copies of your Passbook or Cheque.
Step 8: Select the tick option on the disclaimer and click on the ‘Get Aadhaar OTP’ option. From there fill in the OTP received on your registered and linked mobile number. After this, submit the application.
Step 9: After submitting this form, follow the same steps and submit ‘Form 10C’ via the portal. The amount you requested should be deposited into your registered bank account within 15 to 20 days.
EPF withdrawal before five years of continuous service is taxable. In case of EPF withdrawal after 5 years of continuous service, the amount withdrawn (both principal and interest) is exempt from tax. However, withdrawal made before 5 years is tax-free in these situations:
- Withdrawal made due to the ill health of the employee or discontinued business of the employer
- Withdrawal made for any other reason beyond the control of the employer is also exempt from tax
- Income Tax is not applicable on any advance availed under EPF Scheme.
- In withdrawal cases where either the amount is less than Rs 50,000 or the employer closing down the business, TDS is not levied.
- If the amount is more than Rs 50,000, and period of service is less than five years, the subscriber can submit Form 15G/15H to avoid TDS in cases where the income for that year is below the taxable limit
Note that EPFO also allows partial withdrawal from member’s account for meeting financial emergencies arising out of the Covid-19 crisis. Members can withdraw an amount equal to three months’ of basic and dearness allowance (DA) or 75% of the credit balance in the account, whichever is lower.