Home > Income Tax > Help Center > Employee Provident Fund (EPF) Last Updated: Nov 16th 2022

Employee Provident Fund (EPF) Explained

Employees' Provident Fund (EPF) is a social security benefit that an employee may get after the employment period or at the time of retirement. The article explains Eligibility Criteria, Features, Benefits, Withdrawal Procedure, use of UAN with EPFO Portal, EPF Scheme from both Employer and Employee perspective

Employee Provident Fund (EPF) Explained

Employees' Provident Fund Organisation, India, Ministry of Labour & Employment, Government of India established to manage the social security of the employees

EPFO is one of the world's largest Social Security Organisations in terms of clientele and the volume of financial transactions undertaken per EPFO.


Under EPF scheme, an employee has to pay a certain contribution towards the scheme and an equal contribution is paid by the employer. The employee gets a lump sum amount including self and employer's contribution with interest on both, on retirement.


1. Who comes under EPF?

As per the rules, in EPF

  1. It covers every establishment in which 20 or more people are employed, or
  2. Employees drawing less than Rs 15,000 per month for certain category of industries have to mandatorily become members of the EPF.


2. How to calculate the Contribution by employer and employee?

  1. The contribution paid by the employer is 12 % of the salary.
  2. Salary = [ basic wages + dearness allowance + retaining allowance ]
  3. An equal contribution is payable by the employee also.
  4. In the case of establishments which employ less than 20 employees or meet certain other conditions as notified by the EPFO, the contribution rate for both employee and the employer is limited to 10 percent.
For the International Workers

Contribution is 12% of Total Salary (Basic Salary+DA+Retaining allowances+Conveyance+other allowance+special allowance+LTA+Fixed Cash allowance+Petrol Reimbursement+City Compensatory Allowance).

HRA Calculation needs to be excluded from total salary for PF Computation.

An International worker is any employee who is foreign national working in India under an employer registered with EPFO or an Indian employee who is working in a foreign country with which India has a social security agreement.

3. What are the Benefits & Interest of EPF?

  1. A small monthly investment over the time may help you build better corpus for future.
  2. As a Social Security, the funds help you during the retirement.
  3. Provide tax concessions after a minimum period of 5 years of continuous service * (check below)
  4. Like any Social Security, it establishes a saving discipline to help you during financial emergencies.
  5. PF account associated is an independent account that can be maintained after employment, and while switching employments.
  6. Starting from FY 2014-15, EPFO deposits 8.75% interest on the contribution.

4. What are the Workings under EPF?

  1. Out of employer's contribution, 8.33% will be diverted to Employee Pension Scheme, but it is calculated on Rs 15,000.
  2. for every employee with basic pay equal to Rs 15,000 or more, the diversion is Rs 1,250 each month into EPS.
  3. If the basic pay is less than Rs 15,000 then 8.33% of that full amount will go into EPS. The balance will be retained in the EPF scheme.
  4. The EPF withdrawal is not taxable if one has completed at least five years of continuous service.
  5. If one has switched jobs in less than five years but transferred the EPF to the new employer, it will be counted as continuous service.

5. How to withdraw EPF?

EPF is a scheme which was introduced with the sole purpose of helping the people after their retirement, to provide them with a source of the fund once they complete their service in an organisation. EPF schemes provide the option of withdrawal before retirement, however it should be used only as a last resort.

Due to COVID19 pandemic made many lost their jobs and caused financial hardships due to health care crisis in 2020, many opted for early withdrawal of their EPF, this document is supposed to be self-explanatory for withdrawal of your PF in India. In case you need more information or assistance, you may take Tax Consultation Appointment with our Team EZTax.in


5.1. Rules for EPF withdrawal

  1. PF withdrawal within the 5 years of account opening attracts income tax. Refer Income Tax Filing Plans
  2. It is not mandatory to withdraw the PF account when an employee changes the employer as the PF can be easily transferred to the new account.
  3. EPF also provides employees with an option of loan. An individual can apply for a loan against PF.

5.2. Eligibility on various types of EPF withdrawals


Comprehensive table describes when or what events are eligible to withdraw PF? How much one can withdraw at that event? and the Minimum service requirement that one must satisfy?

Criteria / ReasonWithdrawal AmountMinimum Service Required
1. An individual who retires from employment after attaining the age of 55Entire amount-
2. Employee can withdraw EPF provided that he person is not less than 54 years old.90% of the EPF Corpus-
3. Employee is unemployed more than a month75% of the provident fund-
4. Employee is unemployed more than two monthsRemaining 25% of the funds can also be withdrawn.-
5. Wedding: A minimum of 7 years of service is required to be eligible for PF withdrawal50% of the employee’s share can be withdrawn for marriage purpose7 years
6. Medical purposes: The withdrawal is applicable for the medical treatment of self, spouse, children and parentsTotal corpus or six times the monthly salary, whichever is lower from the provident fund for the medical treatment purpose.no minimum service or lock-in period
7. Repayment of home loan: if the house is registered in his or her name or held jointly90% of the Corpus3 years
8. Renovation and reconstruction of the house: The house should be held in his name or held jointly with the spouse to withdraw EPF amount for renovation.12 times his monthly salary from his EPF account.5 years
9. Purchase or construction of the house: The property should be held jointly with a spouse or should be registered in the employees name90% of PF balance5 years

5.3. PF Withdrawal before 5 years of service

EPF withdrawal before the completion of 5 years of continuous service attracts TDS on the withdrawal amount. But, if the withdrawal amount is below ₹ 50,000, no TDS is deducted. Rules related to EPF withdraw before 5 years of service are as follow:

  1. EPF contribution is done in four parts – Employee’s contribution, employer’s contribution and interest on each deposit.
  2. If the person has claimed tax exemption on EPF contribution for previous years as per Section 80-C, all four parts will be taxable.
  3. If the person has not claimed tax exemption in the preceding year on EPF, the employee’s contribution part will be tax-free at the time of withdrawal.
  4. The tax will depend on the income slab in which the person fell for that year.
  5. The tax will be applicable in the year of withdrawal however the consideration will be done for each year.
Flowchart on TDS Rate after EPF withdrawal

5.4. Withdrawal rules after retirement

  1. An employee can claim for the final settlement when he reaches the age of 58 years.
  2. With regards to EPS, if an employee has not completed 10 years of service at the time of retirement, he can withdraw the complete EPS amount along with his EPF
  3. If the member completes 10 years of service, then he has to submit a pension certificate.
  4. The withdrawal of funds from EPF accounts after retirement is completely tax-exempted.
  5. The interest earned on the EPF fund after retirement attracts tax.

5.5. Documents for EPF Withdrawal

  1. Forms like Form 19 (Final PF Statement), Form 10C (pension Withdrawal), Form 10D ( Employee, widow, widower major and orphan, guardian, nominee and Dependant Parent) and Form 31 (Part withdrawal of PF Amount)

    Note: However, now these documents have been replaced by a composite claim form which needs the Aadhar details of the employee

  2. Identity Proof
  3. Address Proof
  4. Bank Account Statement
  5. A blank and Cancelled Cheque
  6. Two Revenue Stamps


6. How to use EPFO Portal to withdraw PF?


6.1. Step-by-Step Instructions on how to withdraw your PF?

  1. Visit the Official Portal of EPFO
  2. Enter UAN, Password and Captcha to 'Login' into the EPF account.
  3. Select the 'manage' tab to access available options.
  4. Choose KYC to determine whether the details provided via the KYC documents are authentic and accurate.
  5. Select the online services tab
  6. Choose Claim (Form-19 & Form-10C, Form 10D & Form-31). Refer '5.5. Documents for EPF Withdrawal' for more details.
  7. Verify the details displayed on the current page. These include KYC information and additional services details
  8. Input last 4 digits of the Registered Bank Account and click on Verify
  9. Select Yes for your online certificate of undertaking staking that the EPF claim amount will be created to Bank account mentioned.
  10. Click on proceed for Online Claim.
  11. Under the 'I want to apply' option, select 'Full EPF settlement', or 'EPF part withdrawal', or 'Pension withdrawal' as required.
  12. Choose the correct purpose under the purpose for 'which advance is required' option.
  13. Enter the amount of advance required.
  14. Upload scanned documents required for approval. The employer is also required to approve this request for withdrawal to complete.
  15. The EPF withdrawal amount is expected to be credited to an applicant's Bank amount within 15-20 days from the date of application.


6.2. How to register EPF for an Employer ?

The employer needs to provide following required documents for EPF Registration. Lists of below documents are required.

  1. Copy of partnership deed if a company is Registered Partnership firm.
  2. A copy of the certificate of incorporation for a Public or Private Limited Company.
  3. Public and Private Limited Companies need to submit a copy of Memorandum (MOA) and Articles of Association (AOA).
  4. In case of a Society, should furnish a copy of their Registration Certificates.
  5. In case of a Society, should furnish a copy of the rules and objects of the Society.
  6. All legal documents which might be required under the Income Tax Act.
  7. PAN details of the company.
  8. Partition Deed, where applicable
  9. Proof of Incorporation - First Sales Invoice / Licence issued by competent authorities.
  10. Salary details of Employees
  11. Balance Sheet details
  12. PF Statement and Salary
  13. Numbers of employee’s that have worked for the organization for the month.
  14. In case the organization has Registered for GST, the Certificate must be submitted.
  15. First Sale bill.
  16. Crossed Cancelled Cheque
  17. Bank details such as Name, Branch, IFSC code, and Address of the Bank
  18. Machinery and Raw material purchased for the first time.


6.3. What is UAN for Provident Fund?

UAN is a 'Universal Account Number', a 12-digits number that the Employee Provident Fund Organization (EPFO) provides to an Employee. UAN of an employee remains the same throughout life irrespective of the number of jobs one changes. This UAN becomes the identity until his retirement.

Every time an employee switches a job, EPFO allots a new identification number (ID), which will be linked to the UAN of the Employee and the Employer.



6.4. How to know the status of your UAN?

  1. Visit EPFO UAN Portal
  2. Click 'Know your UAN' link on the right side of the browser screen.
  3. Enter the Mobile number and Captcha to request OTP.
    • Once you receive the OTP on your mobile, Enter OTP and Click Submit.
    • You will receive Success message along with your credentials.


6.5. What is UAN Registration & Activation Process?


6.5.1 Document required to generate a new UAN?

Generally, you need to generate UAN only once per PAN. If this is the first time you started using EPFO portal and EPF being deposited by your employer, follow below required documents.

  1. Identify Proof - Driving License, Passport, Voter ID.
  2. Address Proof - Ration Card, Rental Agreement, any Utility Bill on your name (latest).
  3. Bank Account Details - Bank account number, Branch details along with IFSC Code
  4. Permanent Account Number (PAN) Card
  5. Aadhar Card
  6. Employee State Insurance Corporation (ESIC) Card


6.5.2 How to generate UAN?

You can get your UAN directly from your Employer. In case, if your employer haven't shared the UAN, you may generate it using the below process

  1. Visit EPFO UAN Portal
  2. Click on 'Direct UAN Allotment by Employees' link on the right side of the browser screen.
  3. Enter Aadhaar Linked Mobile number and the Captcha
  4. Once OTP received, Enter the OTP.
  5. If all is well, you will see the Aadhaar information pre-populated.
  6. Click to 'Obtain your UAN' to get the UAN generated and the same will be sent as an SMS to your registered mobile.


6.5.3 How to Activate your UAN?

Visit EPFO UAN Portal and Click 'Activate UAN' link on the right-hand side of the browser screen. Fill the information to activate UAN.



6.6. How to get login credentials for your UAN?

  1. Visit EPFO UAN Portal
  2. Click 'Know your UAN' link on the right side of the browser screen.
  3. Enter the Mobile number and Captcha to request OTP.
    • Once you receive the OTP on your mobile, Enter OTP and Click Submit.
    • You will receive Success message along with your credentials.

Once your log into your account, you may change your password. Once activated, you can easily keep track of your EPF and manage your withdrawals and transfers by logging on to the EPFO website.



6.7. PF withdrawal via New form

Under this, the individuals are not required to get the approval of the employer. Some of the prerequisites for this method are as follow:

  1. Update the Aadhaar number in EPF UAN Portal
  2. Aadhaar should be authenticated by the employer and linked to UAN
  3. Individuals are required to fill the form online at the EPF member portal
  4. Duly filled form should be submitted.



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