What is EPF

Last updated on November 11th, 2023 at 08:54 am

What is EPF

Employees’ Provident Fund (EPF) is a retirement savings scheme for employees in India. It is managed by the Employees’ Provident Fund Organization (EPFO). Employees and employers both contribute a certain percentage of the employee’s salary towards

the EPF account, and the accumulated savings can be withdrawn by the employee at the time of retirement or in case of certain contingencies such as job loss or illness.

EPF VS  PF

EPF and PF are the same thing, both stands for Employees’ Provident Fund. It is a retirement savings scheme for employees in India, where both the employee and the employer contribute a certain percentage of the employee’s salary towards the EPF account. The accumulated savings can be withdrawn by the employee at the time of retirement or in case of certain contingencies such as job loss or illness. It is managed by the Employees’ Provident Fund Organization (EPFO).

EPF Benefits

The benefits of Employees’ Provident Fund (EPF) include:

1. Tax benefits: Contributions made to the EPF account are eligible for tax deductions under Section 80C of the Income Tax Act.
2. Retirement savings: The accumulated savings in the EPF account can be used as a source of retirement income.
3. Risk-free investment: The EPF is a government-backed scheme, making it a relatively safe investment option.
4. Nomination facility: An employee can nominate a person to receive the benefits of the EPF account in case of death.
5. Withdrawal options: EPF account holders can withdraw their savings in case of specific contingencies such as job loss, illness, or buying a home.
6. Employer’s contribution: Employers are also required to make contributions to the EPF account, which can be beneficial for employees.
7. Long-term savings: EPF account holders can accumulate savings over a long period of time, which can be beneficial for retirement planning.
8. Compound Interest: EPF account holders get compound interest on their savings, which can help to increase the savings over the years.

EPF FAQ

Here are some frequently asked questions (FAQs) about Employees’ Provident Fund (EPF):

Q. What is the current EPF contribution rate?

Ans. The current EPF contribution rate is 12% of the employee’s basic salary and dearness allowance, with the employee contributing 8.33% and the employer contributing 3.67%.

Q. How can I check my EPF balance?

Ans. You can check your EPF balance by visiting the EPFO website and using the “Universal Account Number (UAN) Member e-Sewa” feature. You can also check your balance via the EPFO’s mobile app or by sending an SMS to a designated number.

Q. Can I withdraw my EPF savings before retirement?

Ans. Yes, you can withdraw your EPF savings before retirement in certain situations such as job loss, illness, or buying a home.

Q. How long does it take to get an EPF withdrawal?

Ans. The time it takes to get an EPF withdrawal depends on the mode of withdrawal and the processing time at the EPFO. Online withdrawal can take up to 10 days, while offline withdrawal can take longer.

Q. Is there a limit on the number of times I can withdraw from my EPF account?

Ans. Yes, there are limits on the number of times you can withdraw from your EPF account. You can withdraw only once in a financial year.

Q. Is there any age limit for withdrawal of EPF?

Ans. Yes, there is an age limit of 55 years for withdrawal of EPF.

Q. Is there any tax on EPF withdrawals?

Ans. The withdrawals from EPF are tax-free if the account has been active for at least five years. However, there are some exceptions and you are advised to check with the income tax department for more information.

Q. How can I change my nomination in EPF?

Ans. You can change your nomination in EPF by filling Form 2 and submitting it to the EPFO.

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