Many people working in the private sector are resorting to their provident fund accounts, majorly due to the financial crunch owing to the Covid-19 pandemic. Employees’ Provident Fund Organisation (EPFO), which regulates Employees Provident Funds (EPF), gives the subscribers the option of early withdrawal from their PF corpus under certain circumstances. People looking to get out a specific amount from their PF account should know rules about withdrawing provident fund money.
Requirements for EPF withdrawals
The subscriber must have an active Universal Account Number (UAN), and the mobile number used for activating the UAN number should also be working. The UAN number should have KYC details like Aadhaar number, PAN number and bank details.
Are EPF withdrawals taxable?
Withdrawing EPF money can be taxable if you want the sum before completion of five years of the PF account. Withdrawing money after completion of the five-year tenure does not attract any tax. Even early withdrawals can be out of the tax ambit if the money is for emergency purposes such as employment termination or medical emergencies.
Your PF money can attract tax if your PF account has not registered any new contributions for five straight years. In such a case, the entire PF amount is considered taxable for that financial year.
Instances of EPF claim getting rejected
Your PF claim can be rejected for reasons including the non-updation of bank account number and IFSC code on the EPFO portal. Incomplete KYC details and an unclear cheque can lead to your PF claim getting rejected. EPFO reserves the right to reject if above mentioned requirements are not fulfilled while making a PF claim.
How to make a PF withdrawal claim online?
After ensuring that you have sorted all such issues related to your PF account, log on to the official website of EPFO, epfindia.gov.in, for making a claim for ‘advance’ withdrawal. After you successfully initiate your withdrawal request, the claim will be forwarded to your employer for approval. Once approved, the amount will reflect in your bank account in around 10 days.
The first step to make the claim is to log on the above mentioned website. Then click on ‘online services’ and select the ‘claim’ section. Now, verify your account number, and then upload a scanned copy of a cheque or your passbook. After that, list an appropriate reason for the withdrawal. Now, an Aadhaar-based OTP will be generated, and after inserting the secret number, your claim will be forwarded to the employer for approval.
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