Employee Provident Fund (EPF) deposits your money in two types of schemes. The first is the Provident Fund (EPF) and the second is the Pension Fund (EPS).
EPS Pension: In the Budget 2021, there has been a change in the rules regarding the provision of Provident Fund. Now, the government will levy tax on the interest received on contributions above 2.5 lakh rupees annually. It is generally believed that provident fund is absolutely tax free. but it’s not like that. EPFO has its own rules, in which provident fund withdrawals with certain conditions. Tax has been imposed for the first time on contribution, but withdrawal has already been taxed. This is a matter of provident fund. But, the most common jobber is suffering from pension (EPS pension)… because, its rules are completely different.
Can the funds deposited in pension be withdrawn? Actually, in the Employee Provident Fund (EPF), your money is deposited in two types of schemes. The first is the Provident Fund (EPF) and the second is the Pension Fund (EPS). 12% of the basic salary of the employee is deducted from his salary and the same contribution is given by the company. The entire 12% of the employee gets deposited in EPF. At the same time, the company’s share is put into two pieces. The first 3.67% is deposited in EPF and the remaining 8.33% is deposited in the Employees Pension Scheme EPS.
What is the rule for provident fund?
According to EPFO rules, partial withdrawals can be made for the marriage of the child, higher education and purchase of a house. Only one month after leaving the job a member can withdraw 75 per cent. After 2 months, the remaining 25 percent can also be removed. PF could be withdrawn only after two months in the event of leaving the job or being unemployed.
What are the rules for pension?
If you want to withdraw EPF amount, then you can withdraw the amount deposited in your account at any time. Whether your job is 6 months or 10 years old. However, you may have some trouble to withdraw the amount of pension. Because, there are many rules, which you should understand. Let us know what you can do for the pension amount in different situation?
What will happen to the pension in case of PF transfer?
According to EPFO’s Enforcement Officer (Retd) Bhanu Pratap Sharma, if you transfer your Provident Fund (PF) from one account to another, whatever your service history, you can get the pension amount anytime in any condition. Will not be able to remove. Because, only the amount of PF is transferred from the transferred account and you can withdraw money of PF only. The pension amount is added to your service history. This means that if your service history becomes 10 years even while working at different places, then you will be entitled to pension and on attaining the age of 58 years, you will get some salary as monthly pension.
If the job is less than 6 months, can you withdraw the pension money?
If your job is less than 6 months, meaning less than 180 days duty, then only you will be able to withdraw only the amount of PF. However, you will not get the amount deposited in the pension. Because according to EPFO rules, you cannot withdraw pension money for 180 days of low duty service.
EPS pensioners alert! EPFO has this good news for you – Check if are you eligible for this gain
If the job is more than 9 years and 6 months, can you withdraw the pension money?
If your job has been more than 9 years and 6 months, then you will not be able to withdraw the pension amount with your PF. Because, 9 years 6 months service is considered equal to 10 years. According to the rules of EPFO, if your job becomes 10 years, then you become entitled to pension. After this, at the age of 58, you will start getting the benefit of Eps Pension. This means that you will get a lifetime pension, but you will not be able to withdraw part of the pension before retirement.
When and how can I withdraw my pension money?
If your job is more than 6 months and 9 years is less than 6 months, then you can withdraw the pension amount along with your PF amount by submitting Form 19 and 10c. But, for this, you have to apply in the PF office by manual way. The facility to withdraw pension funds has not been introduced in the online process yet. After filling the form, they have to be submitted in the office of the Employer i.e. EPFO.
Will the pension be given on retirement after withdrawal?
If you withdraw part of the pension in less than 9 years and 6 months, then remember that you will not be entitled to pension after this. Because withdrawing pension money with PF means Full & Final PF settlement and in such cases your PF account number is completely closed. For this reason you cannot avail pension facility for your retirement.
