Provident Fund (PF), one of the most popular long-term savings options, is a crucial financial safety net for employees in India. The funds that you accumulate in your PF account can come in handy during times of financial emergencies. You may also want to tap into your PF to meet your temporary need for funds after you resign from your job.
In this comprehensive guide, we are going to focus on how to withdraw the full PF amount online after leaving your job, the eligibility criteria you need to satisfy to withdraw the funds, and a few key points that you should keep in mind before going through with it.
Read More About Employees Provident Fund
PF Withdrawal Rules After Resignation
The Employees’ Provident Fund Organisation (EPFO), the autonomous entity responsible for managing and administering the scheme in India, has laid out certain rules for PF withdrawal after resignation from a job. Here is a quick overview of the rules.
- To withdraw your PF balance after your resignation, you must have served a notice period of at least one month to your employer. If you have not served the notice period, you must pay your employer the necessary amount.
- Withdrawals after resignation are only allowed if you complete two months or more of continuous service.
- Full withdrawal of the accumulated balance in your PF account is only allowed if you remain unemployed for two or more months after you leave your job.
- Partial withdrawal of up to 75% of the PF balance can be made one month after you leave your job.
- If you join a new organisation within two months of resigning from your job, you cannot opt for full withdrawals and must instead transfer your PF account over to your new employer.
- To withdraw your PF balance online, you must have linked your Aadhaar number and your bank account to your Universal Account Number (UAN).
How to Withdraw PF Online After Leaving a Job?
The process for withdrawing PF online after resignation is straightforward. Here is a step-by-step overview of the process you need to follow.
- Step 1: Visit the EPFO’s unified portal for members.
- Step 2: Log into your account with your Universal Account Number (UAN) and password.
- Step 3: A one-time password (OTP) will be sent to your registered mobile number. Enter it to proceed.
- Step 4: Under ‘Online Services’, click on ‘Claim (Form-31, 19, 10C & 10D)’.
- Step 5: You will be redirected to a new webpage, where you need to enter your bank account number. Once you have entered the details, click ‘Verify’ to proceed.
- Step 6: Select ‘Yes’ and then click ‘Proceed to Online Claim’.
- Step 7: Choose the type of withdrawal you wish to make under the ‘I want to apply for’ tab.
- Step 8: Choose the ‘PF Advance’ form and enter the reason for withdrawal. You may be asked to submit copies of certain documents. In this case, attach high-quality scanned copies of the documents.
- Step 9: Submit the application.
Once the withdrawal application is submitted online, it will be scrutinised and verified by the EPFO. After successful verification, your bank account will be credited with the PF amount within a few days.
Know More About How to Check EPF Balance?
PF Withdrawal After Resignation: Taxability
Now that you are aware of how to claim PF money after resignation, let us now look at it from the taxation aspect.
When you withdraw funds from your PF account before the expiration of five continuous years of service, the principal investment and accrued interest will become taxable in your hands.
On the other hand, if you withdraw funds from your PF account after the expiration of five continuous years of service, the principal investment and accrued interest will become entirely tax-free.
However, if the reason for withdrawal of PF is due to the discontinuation of your organisation’s business or a medical emergency on your part, the withdrawn amount would be tax-free.
Conclusion
With this, you must now be aware of how to withdraw the PF amount after leaving a job and the various conditions that must be met to proceed with the withdrawal. Now, it is important to keep in mind that, although withdrawal of your Provident Fund can help you meet your immediate fund requirements, it could potentially impact your long-term financial security. Unless absolutely necessary, it is often wise to transfer your PF to your new employer or keep it invested for your retirement rather than use the balance in the account to meet expenses.
Frequently Asked Questions
Can PF withdrawals after resignations be rejected?
Yes. A PF withdrawal request can be rejected due to reasons such as incomplete details, mismatch in the details, multiple applications, or insufficient balance, among others.
Can I withdraw my entire PF amount after leaving my job?
Yes. You can withdraw your entire PF balance two months from the date of your resignation. However, it is important to keep in mind that such withdrawn balances may be subject to tax if the withdrawal is made before the expiration of five years of continuous service.
Is it compulsory to withdraw the accumulated PF amount after resigning from a job?
No. It is not compulsory to withdraw the accumulated PF amount after resignation. You can continue to keep the account active and earn interest on the balance until you decide to withdraw or transfer the account to a new employer.
Which form should be filed to withdraw the PF amount?
To withdraw your PF balance entirely, you must file EPF Form 19 online or offline with the concerned Employees’ Provident Fund Office (EPFO). On the other hand, if you only wish to withdraw your PF balance partially, you must file EPF Form 31 instead.
Can I transfer my PF account to a new employer instead of withdrawing the balance?
Yes. You can always choose to transfer your PF account to your new employer instead of withdrawing the balance after resigning from a job.
Can I withdraw my previous company’s PF without transferring the account to my new employer?
Yes. You can opt to withdraw the PF balance partially or entirely instead of transferring it over to your new employer.
