Last Updated on November 12, 2023 by asifa
Working people in India enjoy several employee benefits throughout their service period. Out of all, one of the most important and popular benefits is the provident fund. Even though it is quite famous among employees, many people still have numerous queries related to this employee benefit. If you are one of them, this blog is just for you.
In this blog, we will tell you a host of important EPF facts, from its definition to the online pf withdrawal process.
So, let’s dive in and start by learning about the meaning of PF.
Before discussing anything, knowing the meaning of pf is acutely important. That being said, EPF stands for Employee Provident Fund. It is a beneficial scheme provided by the Government of India for every working individual in our country.
It is a mandatory contribution to be deducted from the salaries of employees who work in a company with 20+ headcounts for provident fund. Both employees, as well as employers, make an equal contribution, i.e 12% of the Basic Pay in this scheme. Depending on the total amount collected, working individuals can acquire pensions after their retirement. Without any doubt, the PF amount reaps many benefits to employees and aids them to meet several expenses before and after retirement.
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Here is the eligibility criteria for both employees and employers in India:
- For Employees
Every working person who acquires a salary including a basic and DA less than 15k every month is considered eligible to open a PF account
- For Employers
A company with a headcount of 20 or above is eligible for registering for this scheme.
If an employee acquires PF benefit that exceeds statutory provisions, employers will have an option to apply for exemption using Form 1.
Before getting into the calculation part, we would like to say that calculating PF is no rocket science. If one understands the formula, anyone and everyone can calculate it in just a matter of minutes.
As we mentioned earlier, employees contribute 12 percent of their salary, including the dearness allowance. For instance, if your salary is INR 20,000, then your pf contribution will be 12 percent of 20,000 that is 2400.
Understanding Online Withdrawal Process
First things first, take a look at two situations when an employee can do a complete online pf withdrawal:
- When s/he retires
- If s/he is unemployed for more than 2 months.
Other than these, there are several other circumstances when employees can make a partial withdrawal as well.
In addition, two main conditions should be met by an individual if s/he wishes to make a withdrawal. Those are as follows:
- UAN and mobile number should be activated and working
- UAN must be linked to KYC
Also Read: When And How To Withdraw PF Online During Lockdown?
Now, let’s know how can one withdraw his/her pf amount online:
- Visit the UAN portal
- Using your correct UAN as well as password, complete the login process
- Hit the Manage option and then select KYC from the menu
- You will be directed to a screen where you have to verify some vital information such as bank details. Doing this step with utmost concentration is necessary.
- Then, hit the Online Services Option provided on the screen and opt for the CLAIM FORM option given in the menu
- The next step is to check the details shown on the screen and click the PROCEED FOR ONLINE CLAIM
- Then, choose a claim form
- After applying, you will receive an OTP that should be entered to submit the CLAIM FORM.
- Last but not least, you will be shown a reference number that can be used to track the status of your claim.
How To Make The Most of this Scheme?
Here are some top ways you can use your pf amount:
- Invest in mutual Provident fund or fixed deposits
- Try stock market
- Consider real estate
- Repay debts and loans
- Go on your dream trip
We hope this blog helped you to understand EPF more clearly.
Apart from that if you want to know about Top Benefits Of KYB Solutions For Business And Financial Institutions then visit our Business category.