1. Full EPF withdrawal permitted under certain conditions; new norms deferred till August 1

Full EPF withdrawal permitted under certain conditions; new norms deferred till August 1

The Ministry of Labour has also put on hold till August 1, 2016, its notification placing withdrawal restrctions which was due to come into effect from May 1.

By: | Updated: April 19, 2016 4:40 PM
epf-780 As per existing rules on withdrawal of EPF, a subscriber has to be out of job for at least two months to seek withdrawal of his provident fund accumulation.

In a move that would bring cheers to Employees’ Provident Fund Organisation (EPFO) members, the Government has decided to permit full withdrawal of EPF corpus for purchase of house, medical treatment for self and family members, education of children in medical, dental and engineering colleges and for child’s marriage.

The Ministry of Labour has also put on hold till August 1, 2016, its notification placing withdrawal restrictions which was due to come into effect from May 1. The move has come after opposition from union representatives in the Central Board of Trustees of the EPFO.

READ | Planning to withdraw your EPF? All you need to know about new norms

FeMoney had reported on April 12 that the government might reconsider its stand to place restrictions on withdrawal and would allow EPFO members to retain rights over the entire accumulated EPF corpus including own contribution, contribution of employers and accumulated interest.

The labour ministry had earlier proposed that if a member is below 58 years, and employed, he or she will be allowed to to withdraw only own contributions lying in the fund and the accrued interest on that and not the entire corpus. The new norms have proposed retirement age for provident fund purposes as 58 years against the earlier 55 years. This meant that the member would not be allowed to withdraw the employer’s contribution and the interest accrued until attaining 58 years.

“This is welcome measure. We were opposed to the move to allow EPFO to hold back a member’s money,” D L Sachdeva, General Secretary, All India Trade Union Congress (AITUC) and member, Central Board of Trustee, EPFO told FeMoney.

As per existing rules on withdrawal of EPF, a subscriber has to be out of job for at least two months to seek withdrawal of his provident fund accumulation. EPFO corpus is created through a 12 per cent contribution from the employee’s salary along with a matching contribution from the employer and the interest accrued on the entire money.

Tags: EPF
  1. M
    Manish Nagale
    Apr 19, 2016 at 12:12 pm
    This is request to all corporate public commission, After resign many peoples depend on PF fund for start any business or any personal use i.e. clouser of Financial insution Loan, Marriage, etc. So we have request to all concern authority please boycott this circular.
    Reply
    1. P
      Pradeep
      Apr 19, 2016 at 9:53 am
      Biggest folly this Govt is committing. Why do they want to hold EPF money? They are dishing out money to Govt employees but they are after private sector employees for no rhyme or reason. They are digging their own grave.
      Reply
      1. B
        Basavaraju
        Apr 21, 2016 at 6:34 am
        It's huge loss for people it's very bad decision by government
        Reply
        1. Arun Satsangi
          Apr 19, 2016 at 10:45 am
          Apparently the move of the Govt is in view of depleting savings deposits but, this is no way. The EPF money, Own contribution as well as Employers contribution both are hard earned by the employee. No one has the right to deny that legitimate savings money to an employee in the hour of need. Income Tax on withdrawal defeats the very purpose of the compulsory savings under EPF. On one had Govt wants to encourage savings under this head to manage its fiscal deficit and on the other hand wants to Tax the same. Other viable alternate lucrative savings avenues be created to inculcate small savings culture.
          Reply
          1. Y
            yashwant
            Apr 19, 2016 at 11:56 am
            This is highly request to Mr jetly No one has right to impose such ridiculous rules on very low earner because this is the our own hard earned saving this is not way of making nation develop if you want to develop nation bring back black money
            Reply
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