The Indian Government modifies the laws quite often to strengthen the pathways. With the improvisation, we must keep ourselves updated as well. So, in this article, we’re going to discuss the new rules of EPF Withdrawals 2020.
EPF Withdrawal New Rules 2020
The EPF savings is a plan, and you can withdraw it only after your retirement. Yet, in some emergent cases, you’re eligible to withdraw before retirement. The maximum retirement age is 58. However, you cannot retire before the age of 55. Mentioned below are some withdrawal rules you must go through-
1. You cannot withdraw the amount during unemployment, unlike bank accounts. EPF is a retirement savings plan, and you can withdraw it only after retirement. However, if you’re unemployed for more than 2 months, you can withdraw 75% of your EPF corpus. After 1 month, you can withdraw the remaining 25%. If you get fresh employment within this 1 month, this 25% gets transferred to your new EPF account.
2. Early withdrawal, i.e., withdrawal before 55 years, is not possible. According to amended EPFO rules, you can withdraw 90% of your EPF corpus before your 1 year of retirement. Make sure you’re above 54 years.
3. However, you can withdraw it partially in case of any emergency. Situations like serious illness, higher education, etc. are eligible for withdrawal.
4. As per the old EPFO rules, you can withdraw 100% only after 2 months of unemployment.
5. You don’t have to wait any longer for your employer’s approval. You can directly do it in EPFO’s office. Make sure your UAN number is linked with your Aadhar and PAN card.
EPF Rules During Covid-19
These were some of the basic rules that you’ve encountered above. Some were added, and some improvised. Next, let’s discuss some hot trending topics.
Covid-19, basically no human existing on earth, wouldn’t have heard of it by now. The pandemic has created such disastrous havoc that waking up safely the next day is hope. Apart from health, many other issues are killing people. It’s probably one of the main reasons for the people of India. The lockdown has caused another dreadful situation. In the wake of the situation, the government has come up with soothing solutions. Let’s know about it in detail.
i. In this lockdown, the money you withdraw from your EPF account is completely non-refundable. The government permitted its citizens to extract money from their respective EPF accounts. However, after 30th June 2020, you’re not eligible to get into this scheme any more.
ii. What I feel is that the lockdown is gonna continue the entire year. So, if you’re running out of money, blindly go for EPF. It is because no other medium is safer than this during the pandemic. All you’ve to do is make a partial extraction of money from your account. To make it easier and safer, it’s also available online for you. The amount that you want can easily get transacted into your account through an online procedure. No outdoor work, no risk, and money in your hand!
iii. The money you extract must be equal to three months of your wage plus DA. Otherwise, 75% of the total bucks in your active account can get considered. Whichever the above yields a lower amount, you shall get permitted to withdraw the money.
For instance, let you’ve 2.5 lakh in your account. Your monthly income with DA is Rs. 40,000. So, as per the rules, let’s see how it works-
Your 3 month salary plus DA- Rs. 1,20,000.
75% rule – Rs. 1,87,5000.
So, as I said, the one with a lower amount will get accounted for. Thus, you shall be permitted to extract Rs. 1,20,000. This you can carry out sitting at home with your laptop itself. You need not go out in this serious scenario. Just take your fully charged laptop and look at the next steps for online withdrawal.
iv. Apart from that, during this pandemic, it’s also improvised for you to devote a lesser amount than before towards your EPF account. Earlier it was 12% of your monthly wage plus DA, while now it’s decreased to 10%. However, it’s valid only until July.
Important Points Related To EPF Withdrawal
- This improvisation has proved beneficial for about 4.3 workers, apart from 6.5 lakh employers.
- All the subscribers of EPFO are only eligible to avail of it.
- The reduction in contribution amount towards EPF found is, however same for the PSUs and CPSEs. That is, they’ll continue devoting 12% of their primary wage.
- This deduction of amount devotion towards the EPF account is relevant only for the people eligible as per the PM Garib Kalyan scheme.
PF Advance Procedure
After knowing all details about the new EPF rules 2020, let’s know how to overcome PF advanced procedure.
1.Go to the official site of the unified portal. For making it easier, the link is given below. Directly click on it.
2. There would be a box showing ONLINE SERVICES. Click on it and choose the type. For COVID-19, you need to choose Form-31. It’s otherwise known as PF Advance. Apart from this, there are other 4 types like Form 19, 10C, and 10D.
3. Next, you need to provide the four last digits of your bank account. For this, either keep your ATM card by your side. Else, if you’ve online payment modes like Paytm, phone pay, etc. will also work. It is written on the lower side of your ATM card.
4. Then you need to provide the cause of your withdrawal. Since you’re extracting due to this pandemic, so you must mention the reason as Covid-19.
5. Mention the total amount of money you want to be transferred to your account. Added to that, keep a scanned picture of your cheque. You need to upload it. Then enter your residential address.
6. Then an OTP gets generated in your linked phone number. Make sure it’s linked with your account.
7. Enter the OTP, and the procedure ends here.
Sometimes it’s quite easier to work through an app than a website. So, next, we’re gonna know how to make a withdrawal through the app.
Withdrawal Through Umang App
Mentioned below are the steps that you must go through for withdrawing money.
- There’s an app in the google play store as UMANG. Download it. Then go to the home page and then tap on the EPFO services.
- Then tap on EMPLOYEE CENTRIC SERVICES, followed by the option RAISE CLAIM.
- Next, you need to login into your account. For that, you need to provide your UAN number, followed by an OTP on your phone.
- For getting the OTP, make sure your phone number is well tied-up with your EPF account.
1. What is the maximum that I can withdraw for Covid-19?
The maximum financial aid that you can get from your EPF is the irrelevance of how much you have in your account. Let’s say you and your friend have the same amount of money in your account, i.e., Rs. 75,000. Your friend earns Rs. 10,000 per month and you Rs. 12,000. Thus, even if you both have an equal amount in your account, you will get different extractions of money. As I’ve mentioned earlier, it depends on your 3-month salary with DA or 75% of your EPF corpora. Whichever gives a lower amount is allowed for withdrawal.
2. How long will it take for the money transfer to my account?
The government has made it feasible for easy and quick transfer to your account. Within a max of 3 working days, the money gets transferred to your account. So chill!
Even though the pandemic has caused severe terror among people, still the least the government could do is give you enough money to meet your financial needs. So stay home, stay safe, and don’t be bankrupted.