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PF Withdrawal Rules – EPF Withdrawal Rules, Conditions & More

PF Withdrawal Rules

Provident fund or employees’ provident fund is a fund created to accumulate contributions from employers and employees. The goal of the fund is to provide the employee with a safety net after retirement. The amount you invest during your working years along with interest will be paid to you once you retire.

Provident fund does not just provide a safety net after retirement, it can also do that during your employment years. You can make partial withdrawals on special occasions like marriage or medical emergencies.

But, there are certain PF withdrawal rules you need to adhere to. We will talk about the rules in this article, but first, let’s revisit the concept of a provident fund.

What is a provident fund?

Employee’s Provident Fund Organization (EPFO) is a governmental body and its function is to administer the provident fund. In an employee’s provident fund account, contributions are made by the employee (12% of the salary) and the employer.

Every employee with a provident fund account will also have a Universal Account Number (UAN). The UAN number has lifetime validity and is portable, so you don’t need to change the number if you switch jobs.

When can you withdraw funds from PF?

According to the PF withdrawal rules, a complete or a partial withdrawal can be made.
For a complete withdrawal, you will have to meet these PF withdrawal conditions:

1. Once you retire from your work life.
2. If you remain unemployed for a period of two months. Note that the status of your unemployment needs to be validated by a gazetted officer. Notably, if you withdraw your PF balance completely while switching jobs without remaining unemployed for 2 months then it will be deemed as illegal.

You can also make partial withdrawals under the PF withdrawal rules. Partial withdrawals are allowed under the following circumstances:
1. Marriage
2. Education
3. Construction of house or land purchase
4. Home renovation
5. Repayment of home loan
6. A few years before retirement

PF withdrawal conditions to keep in mind:

1. PF withdrawals within 5 years of opening an account are taxable
2. You can’t withdraw PF balance from your current job

PF withdrawal for a particular purpose

You can make PF withdrawals under the following circumstances:

1. Medical reasons

You can withdraw funds from your PF balance for the medical treatment of self, spouse, parents and children. Medical reasons don’t require a lock-in period or a minimum service period.

2. Home loan repayment

You can withdraw funds from your PF account if you have to pay outstanding home loans. This withdrawal is subject to certain conditions:
– You should have completed a certain number of years in service.
– The home should be registered in your name, your spouse’s or it could be a joint holding.
– You have to furnish relevant documents related to the home loan.
– The balance of your account or a joint PF account with spouse (with interest) needs to be greater than Rs 20000.

3. Education

If you need to arrange funds for your child’s education after his/her grade10, then you can turn to your PF account. These withdrawals too are subjected to the following conditions:
– You should have completed a minimum of 7 years in service.
– The funds have to be for either your education or your child’s education.
– The maximum PF withdrawal limit, in this case, is 50% of your share of contribution to PF.

4. Marriage

You can withdraw up to 50% of the funds for your, your sibling’s or your child’s wedding. The following conditions need to be met for the withdrawal:
– You should have completed a minimum of 7 years in service.
– The maximum PF withdrawal limit, in this case, is 50% of your share of contribution to PF.

5. Purchase or construction of the house

You can withdraw money from your PF account if you are buying a house or a piece of land to build a house. You can also withdraw money for funding the construction of your house. The withdrawal conditions are:
– You should have completed a minimum of 5 years in service.
– The asset (land or house) should be registered in your name, your spouse’s or it could be a joint holding.

6. Home renovation

For home renovation, one can make a partial withdrawal from his or her PF account. You can avail this facility twice, once five years after the completion of the house and then 10 years after the completion of the house. The withdrawal conditions are:

– You should have completed a minimum of 5 years in service.
– The asset (land or house) should be registered in your name, your spouse’s or it could be a joint holding.

What is the procedure for PF withdrawal?

There are two ways in which PF withdrawals can be made:

1. By submitting an online application
2. By submitting a physical application

Here is a detailed explanation of both the methods:

1. Accessing PF funds through the online application method
According to the PF withdrawal rules, you can submit a PF withdrawal application through the EPF portal. For this, your universal account number (UAN) should be activated and linked to your Aadhaar, PAN or bank details.
2. Accessing PF funds through the physical application method
You can submit an application form at your local EPFO office. For partial withdrawals, you will need to submit a self-attested form.

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