Understanding The New EPFO Withdrawal Rules

By | September 13, 2018

Here’s all you need to know about the new rules on EPF withdrawal. Read on to know more.

Understanding The New EPFO Withdrawal Rules

What is EPF?

The Employee Provident Fund or EPF is a retirement benefit scheme which is available to all salaried employees. This fund is maintained and overseen by the Employee Provident Fund Organisation or EPFO. Any company that has more than 20 employees is required to register for EPF as per the law.

EPF is a savings method for salaried employees wherein, an employee saves a fraction of his/her salary every month along with a contribution from his/her employer. This fund generates an interest of 8% – 12% which is decided by the Government.

Important Guidelines For EPF members

  • The EPF member is required to be registered on the Member Portal to file an Online

Transfer Claim Application.

  • As there are certain pre-requisites to file the Transfer Claim Application online i.e.

the availability of member IDs in EPFO database and registration of digital signatures

of the authorised signatories of the employer, the EPF member is advised to first

check his eligibility to file the Transfer Claim Online through the link – For Employees

> Online Transfer Claim Portal (OTCP) > Check eligibility to file Online Transfer

Claim on the Homepage of EPFO website www.epfindia.gov.in.

Additional Reading: How To Check EPF Claim Status Online?

  • Detailed process flow for registration on Member Portal and for filing online claim

has been explained on the portal for the convenience of EPF members. The member

should go through the process flow before filling up the Online Claim Application.

  • The member has the option to get his/her claim form attested by the present or the

previous employer. However, if the present establishment is exempted, the member

can submit his claim only through the present employer as the Bank Account No. and

IFS Code of the exempted trust would be required to be furnished for transfer of P.F.

accumulations to the bank account of the Trust.

  • In case the Previous Account was maintained by PF Trust of the exempted

establishment, the member should submit a physical Transfer Claim Form (Form 13)

to the Trust while submitting Online Transfer Claim Form (Form 13) to the PF Office

for transferring the service details under the Pension Fund to the new account. In

such a case, the physical Transfer Claim Form (Form 13) to be submitted to the Trust

would be available for print from the data entered by the member while filing online

claim on the Portal.

  • The member is required to take the printout of the submitted online claim

application, sign it and submit it to the employer, previous or present, depending on

the option chosen by the member while submitting the online claim.

Additional Reading: Linking Of Aadhaar To EPF: A Step By Step Guide

What Are The New Rules?

Starting from June this year, the rules for EPF withdrawals have been changed to make it more user-friendly to EPF subscribers. Let’s take a look at the new changes:

Previously, the EPF scheme allowed subscribers to withdraw the final amount after two months from the date of cessation of employment of the subscriber.

Additionally, the member had to contribute to his/her Provident Fund (PF) account consecutively for at least 10 years to become eligible for pension. And if the account was closed prematurely the member would not be eligible for pension on his/her EPF.

But the new rules state that a subscriber who resigns from their job can now withdraw 75% of the total EPF money after one month from the date of cessation of service. Also, subscribers will continue to have a choice of withdrawing the entire amount if they choose to close the EPF account after two months.

Additional Reading: The EPF Withdrawal Rules Just Got Cooler

These new rules bring respite to many EPF subscribers who wish to withdraw their well-deserved hard-earned money. And in case you’re wondering what to do after withdrawing your entire EPF amount, we have some great investing ideas only for you.

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