I have two Provident Fund (PF) accounts with the gap between the jobs. The first job was from 2015 to 2017 and the second from 2020 to 2021. The reason for the gap was that there was no provision for PF in the intermediate job as it was under fellowship. There is no provision of PF in my current job also. Now I have almost 70,000 in my Universal Account Number (UAN) with two PF accounts. I tried several times to withdraw money but to no avail. What would be the best way to get the maximum amount out of this as I want to use this amount to pay my home loan installments.
Also, since my job keeps making me change from fellowship to full time jobs, what should I do to ensure smooth transition of my PF account?
—Vikrant
We understand that you have contributed to the Employees’ Provident Fund (EPF) account during the period 2015 to 2017 and 2020 to 2021 with two different employers as per the provisions of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952. You haven’t transferred. PF accumulation with the second employer along with the first employer. We assume that you are an Indian citizen and your PF account is with Employees’ Provident Fund Organization (EPFO) and not through your employer’s private PF trust.
As per the provisions of the EPF scheme, after the termination of employment, if a member is not employed in any other establishment where the provisions of EPF are applicable, the EPF deposits in the last two months can be withdrawn from the fund. Date of making withdrawal application. Considering that your current employer is not covered under the provisions of the EPF Act, you are eligible to withdraw the entire amount of EPF accumulation.
While submitting the claim form online, among other requirements, you need to ensure that the date of exit / termination of employment is updated by both the erstwhile employers, KYC documents uploaded and approved by the employer Aadhar number has been added. Your EPF account, mobile number tagged with Aadhaar, etc. If you still face challenges in withdrawal of EPF accumulation through online process, you can do an assessment by visiting the concerned EPFO office to identify the reasons for rejection.
With regard to your future employment, if you have existing EPF balance from your previous employer and your new employer is a covered establishment, you can transfer the EPF accumulation to your new employer EPF account. In case your new employer is not a covered establishment, you can choose to withdraw the previous accumulation as mentioned above. To ensure smooth transfer/withdrawal of EPF accumulations. You need to ensure that your EPF records and UAN are updated.
We have not commented on the implications under the Income Tax Act of transfer/withdrawal, which would need to be analyzed separately.
Parizad Sirwalla is Partner and Head, Global Mobility Services, Tax, KPMG in India.
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