Introduction to Provident Fund
The Provident Fund is one that benefits a salaried individual at his retirement. After an employed person is released from his regular job or services at the time of retirement, he is without income. That is when the Provident Fund will be beneficial to the retired individual. This is almost like a savings plan that a person can take advantage of at the time of leaving their job. The person who would like to withdraw their PF can do so before retirement too. However it is best if it is left in the EPFO unless there is a dire financial necessity.
Introduction to EPFO, Salary Deduction
The EPFO is an organization that handles the issues related to the Provident Fund. The expanded form of EPFO is Employee Provident Fund Organization. The companies with more than twenty employees or over compulsorily have to register with the Employee Provident Fund Organization. A percentage of an employee’s salary is diverted and added into the EPF account every month. Out of 12% deduction of employee’s basic salary 3.67% goes to EPF and 8.67% to EPS. The annual interest rate is added to this amount. This is decided by the Government/ Trustees Board and the updated rate of interest is given on the EPF India web portal.
Opt Out of Provident Fund
While we understand that new professionals or fresher’s drawing first salary will be confused on the vanished chunk of money, it is a great retirement benefit fund/scheme. There are a few people who like to opt out of the contribution towards PF. This can be done only at one time. You have to inform your very first employer that you would like to opt out. They will make the necessary changes. However once your PF account is opened you cannot opt out of this PF scheme. Again, it makes a great after retirement fund.
EPF Withdrawal upon Leaving Job
When you leave your present job, you will be thinking what to do with the contributions of your salary to PF. There are two options available. You can get your PF amount transferred to your new employer after drawing your first month’s salary. However the other option is to withdraw your PF amount. You can do so after two months of leaving your job. You cannot withdraw your PF while you are employed. This could be your present or new employer. Let me make it simpler for you. If you have not drawn your wages for two months period of time after leaving employment you can apply for your PF. However there are some conditions wherein you can withdraw it immediately. These are very few conditions. So this topic will be covered in another article. For now let us read on to know how to withdraw PF after leaving job.
Withdrawal of PF before Retirement
If you are an ex-employee of a company and you would like to withdraw your provident fund amount, you can. Some people feel that this is a very long and hectic procedure. Now with the addition of the UAN it is quite a simple process. We will help you out in this article if you would like to get help on withdrawing your Provident Fund. There is a partial withdrawal and there is a complete withdrawal of PF amount. People can do it at the time of retirement. People can also withdraw their PF before their retirement in case in some conditions.
Documents Required to Claim PF
- Universal Account Number – There is an exception to quote your UAN if you left your job/employment before January 1, 2014.
- ID Proof – Your Name, DOB, and Father’s Name must match with your proof of Identity.
- Bank Account you provide to credit the PF Amount must bear your name on provided ID Proof (This means your name on the ID Proof and your Bank Account must be the same)
- Employer should mandatorily register your date of leaving employment in the EPFO Records. (This is Mandatory)
In case you have all these documents ready then you are almost done with the process of withdrawing your provident fund amount. However still there are a few conditions under which you can claim for your PF amount. It is mentioned above in the earlier paragraph. The introduction of the UAN has changed the process of the PF Withdrawal completely. Prior to this it was a tough procedure. Now by quoting the UAN it is even possible to do most of the process online itself.
There are two methods of withdrawing your Provident Fund amount. One is by using the new Form which is only of 1 Page length and not many details to fill in. This one is far better than the traditional form filling where the PF applicant has to fill the entire booklet. The steps are as below:-
1 – Link your Aadhaar Number with your Universal Account Number
2 – Your Employer has to authenticate your Aadhaar Number Link up
3 – Download the new EPF Withdrawal Form which is available online.
4 – Complete the necessary details and check for filling errors.
5 – Take this filled in form and take this to the Local / Regional Provident Fund Office.
6 – Take along the documents required and mentioned earlier in the Documents Checklist.
What you read above is the process of PF withdrawal with the new form available online for download. Now we will go over the process of withdrawing the PF amount with the old form. The employer will provide you with a Form – 19 to fill in. (This form is also available for download online)
These are a few mandatory details that you have to keep ready before checking for a PF Withdrawal. First check with your employer beforehand if you do not have the details to keep them ready.
- PF Account Number
- Employee ID / Number
- Date of Joining
- Date of Leaving
- Bank Account
- IFSC code
- Cancelled Cheque with Same Bank Account
Take your filled in Form – 19 with the Form 10C to your Ex-Employer HR Department. There would be a special team/ person to handle PF issues. They would forward your documents and filled up forms and process the necessary steps. This takes 45 days to 60 days/2 months time. This may require you to make more than one trip to your previous / last employer. You can also take the help of a registered PF Agent to help you out if you do not like the process.