What is Provident Fund and more than 5 ways to withdraw PF

Employees’ Provident Fund (EPF) is the fund created as retirement fund for the salaried employee of the organization/companies covered under the scheme. There are more than 5 ways for PF Withdrawal even before retirement. Every organization/companies with 20 or more employees is covered, and some organizations that employ less than 20 people are also covered, subject to certain exemptions. Every month 12 % of the sum of basic salary and DA is deducted from the salary of employee as PF, which is known as employee’s contribution. The equal amount is contributed by Employer and the sum of employee’s contribution and employer’s contribution is deposited as EPF.

There are more than 5 ways to withdraw PF

The Entire amount of PF can be withdrawn as per below eligibility

On retirement/compulsory retirement of the employee.
If an individual is unemployed for more than 1 month, 75% of the total PF can be withdrawn and remaining 25% can be transferred or withdrawn. For detail order copy of EPFO please click here.
If an individual is unemployed for more than 2 month, 100% of PF can be withdrawn. For detail order copy of EPFO please click here.

The Partial withdrawal of PF is also allowed on completing the following eligibility for each category:

Sr No	Reasons for PF Withdrawal	Maximum amount limit for PF withdrawal	Min service for PF Withdrawal	Other conditions
1	Purchase of House/flat, construction of House including acquisition of site.	For purchase of site: 24 month’s basic wages and DA. For purchase of house/flat/ construction: 36 month’s basic wages and DA OR Total of employee and employer share with interest OR Total cost. Whichever is least	5 Years	Documents related to house /property is required.
2	Withdrawal from the fund for repayment of loans in special cases.	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	10 Years	Certificate from the Agency indicating outstanding principal and interest
3	Advance from the fund for illness(medical treatment) in certain cases	6 month’s basic wages and DA OR Employee Share with interest Whichever is least	Not Applicable	For his/her own treatment or For treatment of family
4	Marriage	50% of Employee share with interest	7 Years	For marriage of self/daughter/son/ brother/sister
5	For post matriculation education of son/daughter	50% of Employee share with interest	7 Years	A certificate regarding course of study and estimated expenditure from Head Of Institution
6	Withdrawal within one year before retirement	90% of amount in PF of the member	Within one year of retirement/ superannuation, whichever is later

Note : Please click here of if more detail is required.

PF Withdrawal is taxable if ?

If you withdraw your funds from EPF before completing 5 years of continuous service, TDS will be deducted. However, no TDS will be deducted when the amount is less than Rs.50, 000. In calculating 5 years of service, your tenure with the previous employer and current employer is added. If you transfer your EPF balance from the old employer to a new employer and your total employment is 5 years or more, no TDS is deducted. TDS will be deducted if there is shortage of few days in completing 5 years so it will be better to withdraw on completion of 5 years.

TDS rate on PF withdrawal before completion of 5 year.

On providing the Pan Card at the time of withdrawal, the tax deducted @10% on EPF balance if withdrawn before 5 year of service ,and the amount is above Rs. 30,000/-. If Pan Card is not provided the tax will be deducted @30%. Therefore you must remember to provide the pan card at the time of withdrawal of PF. If employee withdraws amount more than or equal to Rs. 30,000/-, with service less than 5 years but submits Form 15G/15H along with their PAN, no TDS will be deducted. For link of EPFO order for TDS on PF withdrawal before completion of 5 years, please click here