A guide to Provident Fund (PF) and its criteria, details about transfer PF online with step by step guide and everything about PF claim and nominating a beneficiary.
Saving is an essential one. It is wise to save some money for future rather than spending it lavishly. One can save money in many ways and the organization one works itself offers a financial security for the welfare of the employees in the form of Provident Fund.
What is PF and EPF?
PF is the short form of Provident Fund. PF is a kind of social security in which part of a salary is deducted every month and deposited in a person’s PF account. If a person is working in a private firm, then the company will also pay some money along with the worker for PF. So, when the worker retires or leaves the company, he will receive a huge sum of money. Provident Fund is a mandatory scheme introduced by the Government for the benefit of the employees. According to Government rules, 12% of the employee’s basic salary should be contributed to PF account by the employer and employee. The accumulated fund will be given at the time of employee’s retirement or resignation. If a person joins in a new company, the PF amount can be transferred from old company to new company. The main benefit is that, the PF amount is exempted from income tax as per the rules of Income Tax. Employees’ Provident Fund (EPF) is also the same as PF, and there is no difference.
It is mandatory for an organization having more than 20 employees to register with Employees’ Provident Fund Organization (EPFO). It is covered under the Employees’ Provident Fund Act, 1952. An employee receiving a basic salary of Rs.6500 must contribute to EPF. As an EPF, 12% of the basic pay of an employee is deducted from the salary on a monthly basis as a contribution for an EPF account. The contribution of the employer is 12% which is divided into two parts as 8.33% for Employee Pension Scheme (EPS) and 3.67% for Employees’ Provident Fund (EPF). The rate of interest is liable to change for every year and is announced by EPFO every year. Currently, the rate of interest for an EPF account is 8.65% per annum.
Nowadays, people are advancing faster as they cannot remain the same for a long time. When something comes better than the prevailing, they can easily change for the better. The same thing is happening in the case of jobs in private firm. Switching job is usual and there are many reasons behind changing of jobs like betterment of life. So, while changing job, the employees should keep in mind their contribution to Employees’ Provident Fund. The EPF can be easily shifted from the former employer’s account to the present employer.
Why to Transfer PF instead of opening a new one?
Though the employees are provided with the choice to cancel their former PF account and to start a new one, when joining a new company, one can gain more advantages by transferring the PF from the old employer’s account to the present employer. The primary reason is that, holding on to the PF account for five years ensures that the fund is exempted from taxation. Also, one can withdraw partial amount of money if needed, by still earning the current interest rate on the account.
How to Transfer PF?
The EPFO allows to transfer funds, but it consumes more time, as an employee has to receive Form 13 with the signature of his/her former employer and it is to be submitted to the new employer. The form must be dispatched via post and there are chances for the form to miss. So, to avoid these tensions, one can transfer PF online in a hassle-free way.
EPFO Online PF Transfer
The best way to transfer funds can be done through online means. In order to make PF transfers easy, EPFO has established the computer-connected, self-service gateway on 2nd October 2013. It facilitates for easy transfer claims and withdrawals by its members. Using this system, employees can move their PF balance from the previous employer to the new employer or can undertake partial/complete withdrawal of their PF balance. With the introduction of Unified Account Number (UAN), the transfer process has become simpler, as the account number remains unchanged.
Steps to Transfer PF Online
The following steps are to be undertaken for signing into the EPFO gateway and for transferring PF to the new employer’s account. Funds can be transferred easily for those who are already provided with Unified Account Number (UAN). Those who do not have UAN should get it from their employer.
- At first, enter the EPFO site at http://members.epfoservices.in/home.php and generate the login ID based on UAN.
- It will be followed by a web page where you will be asked to submit your UAN, contact number and particulars of the present employer such as state, account number and establishment number.
- Then it is to be checked whether the account is qualified for transfer on the EPFO website. For that, you have to enter the state in which the employer resided and have to seek by establishment number or name from the drop down menu.
- After filling the information, click ‘Check Eligibility’.
- By clicking on Check Eligibility, you will come to know whether your account is qualified or not. If your account is qualified, you can enrol on the EPFO site.
- On the EPFO site, you need to provide an authentic photo ID such as Aadhaar card, PAN card or driving licence. A Personal Identification Number will be sent from the website to your mobile number which is to be checked.
- After entering the PIN, to make sure, an SMS will be sent to you. Proceed with the process.
- Following that, you will be moved to the EPFO Member Claims site.In order to sign in, you need to submit the document ID and contact number. After login, you are visible to all options.
- Click ‘Request for Transfer of Account’ on the top tab.
- You are now accessible to fill the form for the transfer of PF. The form has three parts.
- In the first part, enrol your personal information. Along with your name and email ID, you need to state the IFSC code of the bank with your salary account number.
- The information regarding your former PF account are to be filled in the second part.
- Provide your new PF account details in the third part.
The application is to be certified by your former or new employer. It may take some time.
- After filling the form, you can check whether the details are right, by clicking ‘Preview’. Errors if any, can be modified.
- After confirming that all details are correct, type the captcha and acquire Personal Identification Number. Then click ‘Agree’.
- Once inputting the PIN, the transfer of claim will be instigated.
The fund transfer status can also be checked in this website. If there is any problem, you can make your queries at the former/present employer end or else you can straightforwardly write down your complaints to EPFO.
Transfer of funds has become easier and time-saving with this online website.
Benefits of Linking Aadhaar with UAN
Nowadays, Aadhaar card serves as the best identification proof in almost all fields. Also, Aadhaar card details are linked with all important particulars to minimize fraudulent activities. There are more benefits for employees in linking UAN with Aadhaar number. By providing the Aadhaar card details in the EPFO member website and by uploading the scanned image of Aadhaar card, the individual information in the Aadhaar card serves as a proof for one’s identification. Some of the benefits in linking Aadhaar card with UAN are,
- Prevents duplicate accounts.
- The Aadhaar card information registered in the EPFO member site serves as an identity proof.
- The employer’s digital signature for transferring funds is not all needed.
- Also, PF withdrawals are possible without the employer’s certification.
- Brings clarity in the system.
How to Nominate Beneficiary for EPF Savings?
As a precautionary action, nominating a beneficiary to collect your PF amount is mandatory in EPFO. In case of death of the employee, the PF amount will be given to the nominee or if any difficult situation arose, these funds can be used. Nominating an inheritor for PF savings can be easily done on the EPFO member website. One cannot be able to choose an outsider as a nominee if they have family. But, those who are deprived of family can nominate an outside person. If no nomination is made, the savings will be distributed to the family members. A new nomination will be created for husband/wife, in case of marriage. The entire procedure of nominating the beneficiary has been made online. Before this, one should fill up Form 2 with the name of the inheritor and the application is to be submitted to the EPFO centre. For nominating the beneficiary in online, one has to follow the steps given below,
- Sign in to the UAN member website. To get into the website, insert your UAN.
- Click ‘Profile’on the UAN menu and from the drop down list click ‘Edit Nomination Details’.
- Your information, for instance, name, date of birth, gender, marital status, father or life partner’s name, establishment ID, member ID, date of joining,and soon will appear on the screen. You are allowed to update the address only. Then click ‘Update’.
- Next, fill the particulars of the members in your family including minors.
- The filled particulars will be displayed on the EPF/EDLI segment. Errors if any, can be altered.
- Once the details are filled, you have to allot certain percentage of your PF amount to each of the family members. The total percentage should tally 100%.
- Next fill the details of the nominee. Those who are deprived of family can nominate an outsider in this part.
- After entering the details of the nominee, click ‘Submit’. Then click on the ‘Nomination Declaration Checkbox’ to check the information.
- After verifying the nomination declaration, make an agreement and dispatch it to the employer.
- Get a copy of the nomination form and sign it. As a formality, get it attested from your employer.
- Your nomination will be digitally signed by the employer via the OTPC site. In certain cases,the nomination can also be turned down by the employer.
How to fix PF Withdrawal Dispute Online?
In certain cases, the employers will not permit their workers for any emergency withdrawals of their PF amount. As the same issue persists for a long time, the EPFO has launched ‘Claim Portal’ through which the withdrawal issues of the employees can be rectified quickly. For workers who are facing such kind of issue, here are the following ways to make an appeal and to lodge a complaint against your boss.
- Sign in to the EPFO claims portal https://employerclaims.epfoservices.in/
- After entering the site, click‘Claim Online’. Here, employees can raise their claim.
- Employees can register their complaints in ‘Complaint Regarding Provident Fund’ against their employers, if the employer refuses his/her employee to make any emergency withdrawals.
- If the issue is valid, EPFO will resolve the problem in due course.
In some cases, an employee could not raise any complaint against his/her employer, as the claims will be rejected without any consent. The claims can be rejected in the following cases,
- The employee should have worked minimum two months in the present company before making withdrawals. Any withdrawal attempted two months previously,will be rejected by the employer.
- An employee cannot be able to withdraw the full PF amount before 57 years of age. In case of emergency, he/she can be allowed to withdraw only 90% of PF amount, though the employee could not attain 57 years of age.
How to Check EPF Claim Status Online?
In order to make PF withdrawals and transfers, the employees should make a claim. To check whether the claim is given consent by their employers or not, the employees should check the status of their claim. The claim status can be checked via EPFO member website, by messaging or by means of EPFO mobile application. If you are fresh to EPF, you can check the claim status in member portal by following the steps given below.
- Visit the EPFO member website http://www.epfindia.gov.in/site_en/KYCS.php
- On the portal, click ‘Know Your Status’.
- Then enrol the state in which your PF office is situated.
- Next, type your establishment code.
- After entering establishment code, register your PF account number.
- Now provide your PF account number’s three-digit code.
- Click ‘Submit’. The claim status ID will appear along with the claim.
- Once knowing your claim ID, the claim status can be checked.
- Once your claim is given consent, you will receive an SMS from the EPFO.
Thus, by using online PF transfer, one can transfer PF easily from one company to another.
rahulsasmal - Dec 13, 2017
How to Transfer PF account