Latest EPF Withdrawal Rules w.e.f 10th Feb 2016

The Ministry of Labour and Employment, Government of India, has recently made a few amendments in the Employees’ Provident Fund Scheme, 1952 (PF Scheme). These guidelines are mainly related to ‘early withdrawals‘ from Provident Fund & provisions related to PF withdrawals. These latest EPF withdrawal rules are effective from 10th February, 2016.

Amendments are related to;

  • Full EPF balance cannot be withdrawn before attaining the Retirement Age.
  • Continuity of EPF membership.
  • Increase in Age limit to withdraw 90% of PF balance.
  • Partial withdrawal of EPF amount on Resignation.
  • Increase of retirement age.

Let’s discuss in detail about these new PF withdrawal rules.


Latest Update(20-Apr-2016) :“Govt rolls back new EPF withdrawal norms and old system will continue. The notification which was issued on 10th Feb, 2016 has been cancelled.” So, the existing rules will be continued..

Kindly click on the below image to download the latest notification.EPF new rules cancelled - Latest notification - Amendment pic


Latest EPF Withdrawal Rules

  • Full EPF balance cannot be withdrawn (limit on early PF withdrawals)
    • Existing rule : The EPF members (employees) can withdraw the full EPF balance after 60 days of unemployment. (The EPF balance consists of employee’s contributions + employer’s contributions + interest amounts. Every month 12% of your “salary” is contributed towards EPF account.)Employees' Pension Scheme
    • New Rule : The EPF members cannot withdraw full PF amount before attaining the age of retirement. The maximum withdrawal on cessation of employment cannot exceed an amount aggregating employee’s own contribution and interest accrued thereon. You can withdraw your contributions + interest portion only. The employer’s portion can be withdrawn after attaining the retirement age (58 years).
  • Continuity of your EPF membership
    • Existing rule : If an employee withdraws full EPF amount after resigning from the job, his/her PF membership is deemed to be terminated. That means he/she is not a member of EPF scheme after the full withdrawal.
    • New Rule : An employee can only withdraw his share on resigning from the job. You cannot withdraw full EPF amount before attaining the retirement age. So, you will still be the member of EPF even if you cease to be an employee of a EPF covered establishment. I believe that concept of In-operative EPF a/c‘ may cease to exist.
  • Retirement Age
    • Existing rule : The retirement age is considered as 55 years.
    • New Rule : The age of retirement has now been increased from 55 to 58 years.
  • EPF Withdrawal provisions
    • Existing rule : You (employee) can withdraw the full PF amount on retirement from service (55 years) or on cessation of employment and not being employed for at least 60 days.
    • New rule : As discussed above, the retirement age has now been increased from 55 to 58 years and the option of full EPF withdrawal on resignation will not be allowed. You can withdraw your contributions + interest portion only.
  • 90% of EPF balance
    • Existing rule : You can withdraw up to 90% of your entire PF balance (employee share + employer share) on attaining 54 years of age or within one year before actual retirement, whichever is later.
    • New rule : You would now be able to avail this option only on attaining the age of 57 years. The age has now been increased from the current 54 years to 57 years.

Govt notification Restrictions on EPF balance withdrawals


Budget 2016 & EPF Scheme New Rules

Budget 2016 is negative for the salaried class. As per the Budget 2016 proposal, at the time of retirement, 40% of the EPF lump sum withdrawal is tax-exempted, 60% of the corpus is subject to taxes as per the applicable Income Tax Slab. To avoid this, the EPF member has to invest this 60% balance in an Annuity life insurance product.

However, this 40:60 tax rule is applicable only on the corpus created out of contributions made after 1st April, 2016. also, the EPF member who is investing in Annuity dies and when the original Corpus goes in the hands of his heirs, then there will be no tax.

The Budget 2016-17 proposal of levying income tax on 60% of EPF balance has been withdrawn by the government. So, no tax will be levied on PF withdrawals at the time of retirement. The other Budget proposal to make 40 per cent of the total withdrawal from the National Pension Scheme (NPS) will however remain unchanged. (Latest news : 08-March-2016)


Your EPF contributions / savings are meant for your retirement. Dipping into the corpus before you retire prevents your money to gain from the power of compounding.

These new rules may FORCE you to accumulate a portion of your PF fund till you attain the retirement age. Besides above new rules, kindly note that the withdrawals from the EPF within five years of joining are taxable.EPF Withdrawal TDS applicable June 2015 EPF Balance - new TDS limit 50,000 from FY 2016-17

TDS has been made applicable if one withdraws PF within 5 years. (Budget 2016 update : In case of payment of accumulated balance due to an employee in EPF, the TDS limit is being raised from Rs 30,000 to Rs 50,000. So, TDS is not applicable if the PF withdrawal amount is less than Rs 50,000. This new amendment is applicable with effective from 1st June, 2016.)

If you would like to retire early or would like to start a business after being employed for few years, you may surely not like these new EPF withdrawal rules.

Proposed EPF Withdrawal Rules with effective from 1st August, 2016

Below are the key takeaways from the latest press-release released by the Ministry of Labour & Employment.
  1. The proposed new withdrawal rules will be implemented from 1st Aug 2016.
  2. The amended rules do not allow an employee to withdraw the entire amount from his or her PF account till the subscriber attains the age of 58, the age of retirement.
  3. According to the new rules, he/she can only withdraw the contribution to the PF and interest accrued on it. The employer’s contribution and interest can only be withdrawn after attaining the age of retirement.
  4. Based on the public feedback/backlash, it has been decided that ‘Full PF accumulations (Employees + Employer’s share + interest) will be paid to the EPF member on fulfilling any of the following conditions;
    • Housing purpose of a member.
    • Medical treatment – Self / family member suffering from TB, Leprosy, Paralysis, cancer or Heart operation.
    • Marriage of children.
    • Professional education of children (like Medical/Engineering/Dental).
    • If EPF member joins an establishment belonging to or under the control of the Central or State Government and becomes a member of Contributory PF or any old age Pension scheme. (I believe this rule may again lead to lot of confusion and we may witness backlash from PVT sector employees.)
The above said provisions/rules will be effective from 01-Aug-206 and the necessary notification will soon be released in the official Gazette of India.(These points are based on the latest press release. I will try to update this post if required…)

Latest Update (30-March-2016) : The Employees Provident Fund Organization (EPFO) has decided to provide Interest on Inoperative Accounts from 1st April, 2016. This move will benefit over nine crore such account-holders having total deposits of over Rs 32,000 crore. Inoperative accounts are those wherein the PF contributions have not been received for 36 months. EPFO had stopped payment of interest to such accounts from April 1, 2011.

Latest Update (27-June-2018) : EPF Subscribers who resign from their service can now withdraw 75% of their total Provident Fund (PF) kitty after one month from the date of cessation of service. This will be considered as a Partial PF withdrawal (Advance).

Members will continue to have the choice of withdrawing the entire / balance amount, if they want to close the account, after two months , provided the member is unemployed and/or do not make any fresh PF contributions.
Currently, the EPF Scheme allows Final withdrawal (full withdrawal) only after two months from the date of cessation of employment of the members.

You may like reading another interesting article :How is Interest calculated on my EPF A/c?

(Reference : Govt notification, Asan Ideas for wealth – Facebook Group & pwc.in)

  • Arshiya says:

    Hi Sreekanth,

    According to new PF rule:-

    How much employees can withdraw from their PF account? Is their any certain amount?
    Who are eligible to withdraw?
    What % can be withdrawn?
    What is the procedure?
    how much time it takes for?

  • Lingaraj Khilar says:

    Hello ,

    I have withdrawn the some portion of my PF amount as i had completed the 5 years in my organization .Can i withdraw more amount after 2 years of withdrawing 1st time ?Means can i withdraw amount more number of times after 5 years of completion in Org if i have amount in my PF account ?

  • Arunava Bhowmik says:

    Dear Sreedhar,

    I am much grateful to you as you are providing such valuable information to us.

    I am resigning from my employer after 12 years of service as I have chosen to immigrate to a different country.

    Request you to please let me know whether or not I can withdraw the full amount from my PF account (Employee Contribution + Employer Contribution + accumulated interest) . My employer is saying I may be only eligible for Employee Contribution + interest on it.

    1. What is the process of getting full PF amount (Contribution + Employer Contribution + accumulated interest)?
    2. If I am only eligible for my portion of contribution then should I keep on receiving interest on the employer contribution till my 58 years of age (long way to reach) and my PF account will not be inoperative?

  • Shiva says:

    Dear Sir,

    I worked in an organization for more than 5 and a half years in Delhi and quit last November (UAN was generated). After a week I joined another firm in Bangalore. Here also the company deducts for PF. I wish to withdraw the entire pf corpus of the previous firm (5.5 years). My only doubt is for month of december i received an update telling a contribution has been made. In this case can i still withdraw ?

  • Dheerendra says:

    Hi Sreekanth,

    I am planning to quit my current job that I have been working in for 4 years now.
    And start higher studies from October.
    In this case will I be able to withdraw complete accumulated PF ? with 10% Tax on it
    Or I can withdraw only my contribution to the PF?

    What are the provisions to get all of PF amount withdrawn in my case?

    Thanks for the help

  • Venkatesh says:

    Hi Srikant,
    Thanks for a great blog – I really admire your writing and the detailed work that you do.

    I read your blog article
    – I worked for past 11 years at a company. Traveled abroad after 6 years – this is when i withdrew my previous PF.
    – After I came back to India, the PF was started again. I worked there for another 4 years and joined a startup, where there is no PF. (I am currently in the startup, without a PF since 1 year).

    Questions:
    1. Can I withdraw my PF (I have about 12 lakhs) without having to pay any tax? [Technically, I am still a few months under the 5 year bracket]
    2. Since there is no contribution to my PF fund, is there any provision to withdraw in full (Employee + Employer contribution)?

    Kindly respond.
    Thanks,
    Venkatesh

  • Cherian Peter says:

    Dear Sreekanth,

    I have retired at the age of 55. My EPF balance was not taken. Now I am 58. I am sure that for the past 3 years, I was getting interest on my balance. If I decide not to withdraw the balance, will I keep getting interest and till what age ?

    • Dear Cherian ..EPFO has earlier stated that they will give interest on dormant accounts too, but I believe that no notification has been issued in this regard.
      So, suggest you to submit your grievance to EPFO online..click here..
      In case, you get a reply from them, kindly do share the information here, can be useful to other blog readers as well. Thanks!

  • Sudha says:

    Hello Sreekanth,

    I have applied for PF since I completed 6.5 years in the same organization and applied for PF withdrawal for my marriage purpose. But it’s been rejected with the Insufficient service. If I re-apply the same application for pf withdrawal since 7 years completed. will they consider it and can I withdraw the amount?

    • Dear Sudha ..Minimum 7 years of contribution is required to take advance for the said purpose.
      Kindly read : EPF partial withdrawal rules..

    • Sai says:

      Hi Sreekanth,

      I have resigned from job last January and I am planning to withdraw my entire PF balance( employee and employer contribution with interest component.) My question is If I take up a new job after few months. am i allowed to use the same UAN no for PF contribution from new company. Please clarify

  • Rahul says:

    Dear Shreekanth
    I want to know if there is any latest change in partial withdrawal of PF amount. I want to withdraw one Lac rs for medical purpose and as i have heard that i just need to give self declaration for the same , no other documents like admission or doc documents are required , even i dont need to inform my company as well. I have completed2 yrs in service
    pl help me if you have any information around this.

    • Dear Rahul ..Yes, no document is required. Kindly go through my latest article on this..

      • Rahul says:

        Thanks Sree.

        One more help pls , i have updated Aadhar card on the PF website however it says pending for verification. My account number and mobile number is already there in the verified list.
        Is there anything else needs to be done in order to get my aadhar number verified with PF office .

        • Dear Rahul .. Your employer has to verify your KYC details.

          • Rahul says:

            Hello SIr
            It says to withdraw pls submit 2 copy of 15G/15H form if applicable. What is this , Do i need to submit these forms if i am partially withdrawing money for medical purpose.

          • Dear Rahul ..Not required..

          • Rahul says:

            Hi Sree

            I did visit PF office in bangalore KR Puram and they gave me CCF ( Aadhar) but asked me to give filled up form with medical certificate as i am taking partial amount from PF and also certificate that i am not covered under ESIC ( I am not covered under ESIC ). Also behind the CCA form it is mentioned that these 2 we have to submit.
            What should i do and who will give me ESIC ceritificate

          • Dear Rahul,
            This is strange.
            As per the latest notification, no documents are required..kindly read this article..
            Suggest you to also check with your employer regarding ESIC certificate.

  • Aravind says:

    Your information is really appreciated. I have few doubts about my pf withdrawal.

    I have pf amount of 1 lac 90 thousands and i heard i cannot take entire amount and few amount i should take after retirement. Now i am travelling to US in feb of 2018 and wanted to Withdraw my PF amount. Now i have completed 6 year 7 months in the same company and this is my first company.

    Can you please let me know how much approximate amount i will be getting out of my 1lac 90 thousands.

    Thanks again for your help.

    Cheers,
    Aravind

    • Dear Aravind ..As your contribution period is less than 10 years, you can withdraw entire EPF balance including EPS amount.

      • Lokesh says:

        I worked in India for 15 Months ( 20.01.2016 to 31st March 2017) , Monthly Employee Contribution 5310 .

        How much should I expect back on Withdrawl . I am leaving the country so no more employed in India .

        Thanks in Advance.

  • trilok joshi says:

    we are 4 person worked on private computer training centre . the management of the entire centre by indian army .we are working since 15 years i.e 2002. can we apply for epfo govt scheme. pl confirm

  • Michael Augustin says:

    Dear sir
    i am Michael Augustin
    i had completed my pf formalities in my old office and they were already submitted my pf withdrawal form to the pf office at 4-Apr-17 but i was resigned my job at 30-Dec-16 they taken 3 months for the submission process now my doubt is when will i get my pf amount. how many days it will take

    • Dear Michael ..EPFO generally settles the claims within 30 days. Kindly track your claim status online.

      • Michael Augustin says:

        i used those things already but it is doesn’t showing the details and its simply showing the record is not found and approval details on PPO and scheme certificates will be made available soon. then the pfo site is not even showing my balance and my passbook also the site is totally waste the page is not open. frequently its showing page is under construction or page error what will i do sir,

        • Dear Michael ..If ‘no records are found’, mostly your withdrawal form might not have been received by the EPFO. Suggest you to check with your ex-employer.

  • Suresh Kumar says:

    Hi Sreekanth,

    First I would like to thank you for all wonderful clarifications. I am working in my present company for last 7 years. now I would like to withdraw my EPF money for house purchase. Whether any percentage restrictions or I can fully withdraw the available money? and what doc I have submit for the same?

  • Prashant Mishra says:

    Hi Sir,

    I am quitting my job and going US for my Higher education. My last day in my company will be 10 July and as per this date I will be having 14 days short of 5 years.

    I can see 3 contributions in my PF. Employee’s contribution, Employer’s contribution and a part of Employer’s contribution towards EPS. How much can I withdraw from my PF and what date shall I apply for PF disbursal in order to get maximum disbursment?

    Thanks in advance 🙂

  • Sathish says:

    Hi admin,

    I worked in a private company for about 15 months and the balance in my passbook was around Rs.24,ooo. When I claimed, I’ve received just 11,000. Is this the amount I’ll get after all deductions? I think its no and there should be some error. Can u please explain??

    • Dear Sathish ..Did you receive both EPF & EPS?
      The EPF balance if withdrawn before 5 years is taxable (though TDS is not deductible).
      Kindly read : EPF withdrawals & new TDS rules.

      • Sathish says:

        Thanks for your reply sir. It is not clear for me too because I just received a text from both bank and epfo that 11,000 has been credited to my account. My epfs balance is Rs.12,690. So can I assume that I’ve only received epfs and wait for some more days for the remaining amount to reach my account? What do you suggest sir?

  • o.p.nautiyal says:

    Dear sir,
    I am over 62 yrs. of age & still working & contributing to EPF fund. If I wish to stop contributing to my EPF fund without resigning from my job, can I withdraw total accumulated EPF amount ? Thanks..

  • Bratin says:

    Dear Sir,
    I was working in a private school, since 2010 but my EPF account operated from 2012. Now recently I have joined state govt. School. Can I withdraw my full PF amount. Is my withdrawal amount is taxable as according to pf history my service life is less than 5 years? My experience certificate although saying i have served more than 6 years.
    Also another quarry is there any provision to switch over EPF to GPF?
    Kindly let me know the information. Thanking you
    Bratin.

  • Gowrisankar cherukuri says:

    Dear Mr. Sridhar,

    I was working in Central Govt. and took vol. retirement in 2006. I was working in Govt. till 01.06.2006 and in 2017 Jan 7th i joined a proprietorship firm and from that time on wards PF was deducted and credited into my account. Now my age is 57 years and my DOB is 26-02-1960. Now i wanted to withdraw from my PF for purchase of ready built house. How much i can withdraw and what are the other conditions for withdeawal.

  • Surinder says:

    I left India in 2015. I want to withdraw my full PF now. Can I do that as per new rules

  • rajesh says:

    Dear Sir,
    I applied for PF withdraw process 3 month ago but till time its showing payment under process from last 1 month on EPF portal.

    I have download my passbook & i just want to confirm that which amount i will get after withdrawal .

  • Dinesh says:

    Dear Sreekanth,
    Hi How are you . nice information . iam working for an organization for more than 5 yrs , is their an option to withdraw Full / Partial amount from my PF to purchase plot. If yes , can you tell me the process for the same.
    Thanks
    Dinesh

  • Aquib Qureshi says:

    I’m posting this on 12th of April 2017.
    I have little confusion related to the post which you have made.

    I’ve heard as per the new rule we can withdraw our PF money even if my tenurity is less than 5 years in a company?(I don’t want to give any fake reason of marriage or any other stuff)
    I was working with a MNC and i just recently joined a new one a month ago. The tenurity was 2 years in total with the previous MNC. So can i withdraw money? I don’t have specific reason like marriage, House buying etc. I just want to make use of it.

    If your answer is yes, then how much i can withdraw? Full amount or partial amount?

  • Shariq Naseer says:

    Hi

    I am in a company and completed 5 year however, now I want to withdraw my PF amount
    Please advise that how much amount can I withdrawl?

  • Umair Farooq says:

    Hi Sreekanth ,

    Thanks for the article.

    I resigned from a company in November 2013 and withdrew my PF from there 6 months ago. But I believe I’ve been credited less than what I am supposed to receive. In the payslip there are three deductions – 1. Employee PF Contribution , Profession Tax and Employee State 1. . I worked there for 18 months and the total amount accumulation of 18 months is about 16500 INR. (excluding employer contribution). I have been credited 24,395 INR and I believe this is less as there is also interest included. Can you please tell me what is the interest amount that we receive on withdrawal? And to make clarifying my doubt easy for you, my total employee contribution accumalation for 18 months was around 9000 INR

    Thank you

  • SANDIP PRAKASH SINGH says:

    Dear Srikant Ji,

    Just wanted to know that while entering the data for new employee/ member registration in epf ecr 2.0 , there is an option given by site which asks us to fill monthly wage on joining.

    Now i just wanted to know what to fill there – the basic salary of individual or gross salary of individula

    I have filled gross salary of individual as per his joining files (Considering full month attendance present i.e – 31 days)

    Do please let me if i have performed right thing or i need to show basic salary of employee on place of gross salary.

  • Gently says:

    I am just completing 10 years in an organization. I am planning to purchase Land, Is it possible to withdraw PF, If yes what percentage can I withdraw?

  • SANDIP PRAKASH SINGH says:

    Dear Srikant Ji,

    Before i move further, a short and brief intimation of mine as i work with the capacity of HR in Gurgaon based organization. Now that i was an active member of CITE HR (a website known for HR related topics), i tried alot to find out if new epf withdrawal rules are on the card.

    Can you tell if our employee can withdraw full epf amt(ee/er share) as earlier
    I have got a lot of form 19 & 10c, should i get it filled and submit to PF Officees.

    (However, if full epf is not allowed, Pls pass a notification as well)

    Hope, you will just reply as this is my first and kind of introductory mail/request to you.

    Thanks in advance !!

    Sandip Pr Singh

  • Maddy says:

    Hi Sreekanth,

    I have been unemployed since last 2 months. I just wanted to know if I am entitle to withdraw full PF or not.
    second question is, do I need to submit any documents stating that I have not been working since last 60 days?
    if doc not required, would EPF office know that I have not been employed for 2 months?
    thirdly, what all forms do I need to filled and submit for withdrawal of whole amount which includes pension amount.

    Please help me get clarification on this matter.

    Thanks,
    Maddy

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