The employee provident fund account yields a return of 8.5 per cent annually.
For the working-class category, Provident Fund (PF) account is a good option for saving with good interest. It is a fund to which both the employee and employer contribute 10 per cent of the employee’s basic salary each month. Earlier this percentage was 12 per cent for private organisations.
The employer and employee deposit their contribution with the Employee Provident Fund Organisation (EPFO) every month. Generally, the accumulated or a part of the amount in an EPF account can be withdrawn by the employee in the event of retirement, or resignation.
But witnessing the tough times for many, the EPFO has now allowed the members to withdraw a part of the amount in case of the COVID-19 crisis or in the case of unemployment. Similarly, this amount can be transferred from one company to another in case the employee changes his job. EPF account yields a return of 8.5 per cent annually.
The members, who are unemployed for a month or more can now avail a non-refundable advance of up to 75 per cent of the amount available in their PF account. The EPFO earlier tweeted that “Members who are no longer employed for one month or more can avail a non-refundable advance of up to 75 per cent of the amount available in their PF account.” The auto-mode of settlement enables EPFO to reduce the claim settlement cycle to just 3 days, against the statutory requirement to settle the claims within 20 days.
This facility will financially help members during unemployment and will also enable them to continue their pension membership, as their EPF accounts are not closed. These are non-refundable advances, and the person will not have to deposit the withdrawn money back into its EPF account. The person eyeing an advance can make an online application using its login on the EPFO’s website.
However, if you are looking to claim your PF then avoid these 5 mistakes. If not followed properly then your PF withdrawal claim may get rejected.
Seed Bank Account with UAN
The bank account number should be seeded with the UAN (Universal Account Number). If your account is not seeded then there may be trouble in getting money. Apart from this, the IFSC number entered in the records of EPFO should also be correct.
If the KYC of any account holder is not completed, your application can be cancelled. Your KYC details must be verified as well. You can check whether the KYC is complete and verified or not, by logging into your member e-service account.
Incorrect Date of Birth (DoB)
Your application can be cancelled even if the date of birth (DoB) recorded in EPFO and the date of birth recorded in the employer’s record doesn’t match. EPFO earlier issued a circular on April 3, in which it relaxed the rules for correcting the date of birth recorded in the records of EPFO and linking UAN with Aadhaar. Now you can correct the date of birth for 3 years.
Must have Linked UAN-Aadhaar
It is also necessary to link UAN with Aadhaar. If your UAN-Aadhaar is not linked, your EPF withdrawal claim may get rejected. There are four ways to link UAN or EPF account with Aadhaar. You can also link it sitting at home.
Incorrect Bank Account Details
The PF claim money will be credited in the same account, which will be recorded in the records of EPFO. Therefore, while making a claim, fill in the account details carefully. If you enter the wrong account number or any other account number then your application will be rejected.