Employees’ Provident Fund (EPF) is a retirement scheme that is available to all employees working in India, subject to certain conditions. In this scheme, an employer deducts a fixed percentage of an employee’s salary, matches it with their own, and then contributes both components to an EPF account created for the employee. It is managed under the provisions of the Employee’s Provident Fund and Miscellaneous Provisions Act 1952 and falls under the aegis of the Central Board of Trustees (CBT). EPF contribution allows salaried employees to earn interest on their contributions. As per the latest amendments, the current EPF interest rate stands at 8.15% for FY 2022 – 2023.
In this blog, we will see how EPFO works, the schemes available, the employee pf online withdrawal process, and more.
How Does Employees’ Provident Fund Work?
Unless exempt, a business organisation must deduct a certain percentage of their employees’ basic salary for the Employees’ Provident Fund (EPF). The employer must also match this amount. The combined amount is then deposited into the EPF account. The EPF deposits will also earn you interest at a rate decided by the government.
For example, if an employer deducts ₹4,000 per month from your salary for EPF, they must also match it. So, the total contribution to your EPF account every month will be ₹(4,000+4,000)=₹8,000, which will earn you interest at the rate 8.15% p.a. (current rate).
Please note: To calculate your EPF contribution, your employer cannot consider salary components, such as HRA, conveyance allowance, and special allowances among others.
Schemes Offered by Employees’ Provident Fund Organisation of India
The CBT currently operates and offers three schemes under its aegis. They are:
- The Employees’ Provident Funds Scheme 1952 (EPF)
- The Employees’ Deposit Linked Insurance Scheme 1976 (EDLI)
- The Employees’ Pension Scheme 1995 (EPS)
Under the current rules of the Employee’s Provident Fund and Miscellaneous Provisions Act 1952, the break-up of the contributions by employers and employees to each scheme is as follows:
| Contribution | Employer’s | Employee’s |
| EPF | 3.67% | 12% |
| EDLI | 0.5% | Nil |
| EPS | 8.33% | Nil |
Objectives of EPFO
- To reduce claim settlement times from 30 to 20 days for offline modes and 3 to 5 days for the online mode
- To simplify compliance for both employers and employees
- Ensure constant amendment of EPF rules and guidelines, in keeping with the current trends, government mandates, and convenience of all stakeholders
- To ensure ease of access to each EPF account – online and offline
- To lay a solid foundation for voluntary compliance and higher allocation to retirement savings
EPF Interest Rate
The EPF interest rate for FY 2022-2023 is 8.15% p.a.
The interest rate for EPF accounts is decided annually by the Employees Provident Fund Organisation of India. Once it declares the rate for a particular financial year, the interest rate is calculated on the closing balance for each month and then on the total balance for the year.
As per Finance Act 2021, the interest earned on EPF deposits is taxed at the following rates:
- For employees, who receive a PF contribution from their employers, interest will be tax-free up to an annual contribution of ₹2.5 Lakh
- For employees, who do not receive a PF contribution from their employers (such as government employees), tax is only charged on interest if the PF contribution for a year exceeds ₹5 Lakh
- The interest on employer contribution component to EPF (including all schemes) is tax-free up to a yearly limit of ₹7.5 Lakh.
EPF Calculation
While the Employees’ Provident Fund Organisation (EPFO) decides the rate applicable on your PF account for the entire year, interest is calculated on your month-wise PF balance. For example, if the rate of interest on Employees’ Provident Fund (EPF) for the year is 8.15% p.a., then the interest applicable per month will be 8.15%÷12=0.68% (approximately).
Now, a maximum of 12% of an employee’s salary can be contributed to their EPF account. Let’s assume the employee’s basic salary is ₹20,000 per month. Now, 12% of ₹20,000 is ₹2,400. Now, the employer contributes 3.67% of the basic salary of the employee, from their end, to the employee’s EPF account. 3.67% of ₹20,000 is ₹734. So, the total contribution to the employee’s EPF for the month is ₹(2,400+734)=₹3,134. Therefore, the interest earned on the EPF deposit for the month will be ₹21.3112. So, the total earnings for the month will be ₹3,155.3112.
EPF Form
Based on the exact need, such as withdrawal of Employees’ Provident Fund, an employee may have to use a variety of EPF forms. The following table highlights the name and use of each such form:
| Form Name | Purpose | Download Link |
| Form 15G | To save TDS on interest income from EPF | ⬇ |
| Form 19 | Final settlement of an employee’s PF deposit | ⬇ |
| Form 2 | Nomination and declaration for EPF and EPS | ⬇ |
| Form 11 | For self-declaration of employee details | ⬇ |
| Form 31 | For partial withdrawal of EPF savings | ⬇ |
| Form 5 | When a new employee wants to join EPF and EPS | ⬇ |
| Form 5 (IF) | To claim EDLI deposits made under the EDLI scheme | ⬇ |
| Form 10C | To claim withdrawal benefits | ⬇ |
| Form 13 | To transfer your EPF deposits from an old account to a new one | ⬇ |
| Form 10D | To start a monthly pension | ⬇ |
| Form 14 | To buy an LIC policy with EPF deposits | ⬇ |
| Form 20 | For final settlement in the unfortunate event of demise of an employee | ⬇ |
How to Transfer EPF Money?
- There could be two ways of doing it. One way is when an employee changes their job and their balance is transferred from an old EPF account to a new one.
- The second way is when an employee wants to move their money from an EPF account to an employer’s EPF trust.
Transferring Money From One EPF Account to Another
Step 1: Login to your EPF account
Step 2: Go to the ‘Online Services’ section and choose the ‘One Member – One EPF Account (Transfer Request)’ option
Step 3: Verify your personal details
Step 4: Now, click on ‘Get Details’ to obtain the particulars of your old EPF account
Step 5: You can choose either your old or present employer to attest your claim form. In the highlighted space, enter your Universal Account Number (UAN) and member ID.
Step 6: Click on the ‘Get OTP’ option to get an OTP on your registered mobile number. Enter it in the relevant field to validate your identity.
Step 7: A PF request form with the details entered by you will be generated online. You can submit it to the employer you have selected in the pdf format, after self attesting it. The said employer will also receive an online notification pertaining to the transfer request.
Step 8: The employer will now have to approve your request digitally. Once approved, the money will be transferred to your new Employees’ Provident Fund (EPF) account. A tracking ID will also be generated, which you can use to track the status of the transfer.
Transferring Money from an EPF Account to an Account With an Employer’s Trust
Step 1: Visit the EPFO portal and login using your UAN and password
Step 2: Under the ‘Online Services’ section, click ‘One Member – One EPF Account (Transfer Request)’
Step 3: A new tab will open. Enter the details of your new EPF account number. To find this number, check the salary slip or the PF statement issued by your new employer
Step 4: You could either get your claim form attested by your present employer or your old employer.
Step 5: Now, enter the previous EPF account number (provided the UAN of your old and new accounts is the same) or enter the UAN of your old account. Once you click on ‘Get Details’, the details of your old account will be shown. Click the account from where the money has to be withdrawn/transferred.
Step 6: Click on ‘Get OTP’ now. A one-time password will be sent to your Aadhaar-registered mobile number. Once you enter it in the space provided, your transfer request will be registered successfully. A tracking ID will also be generated. Note down that number and download the form submitted in the pdf format. You may now have to submit it to your new employer, who will also receive an online notification about the submission.
Withdrawal Process of Employees’ Provident Fund
Withdrawing money using your UAN from your Employees’ Provident Fund Organisation account is possible both online and offline.
Employee PF Online Withdrawal Process
- Login to the Member e-Sewa portal
- Go to the ‘Online Services’ section and select the ‘Claim (Form 31, 19 & 10C)’ option
- You will be shown your member details. Enter the bank account linked to your EPF account and click ‘Verify’
- Select ‘Yes’ to digitally sign and authenticate the certificate
- Click on the ‘Proceed for Online Claim’ option. Next to ‘I want to apply for’, provide the reason for wanting to prematurely withdraw funds from your EPF account
- Now select the ‘PF Advance (Form 31)’ to withdraw your funds, either as advance or loan. Also, enter the amount you want to withdraw and mention your registered address.
- Click on the certificate to apply. You may be required to submit some supporting documents as well.
- Now, wait for EPFO to approve your application.
Employee PF Offline Withdrawal Process
You also have the option to withdraw EPF funds through the offline mode. All you have to do is fill out the Composite Claim Form and submit it to your jurisdictional EPFO office.
Please note that there are two types of Composite Claim Forms – one is Aadhaar-based and the other is not linked to Aadhaar. If you choose to proceed with a non-aadhaar composite form, ensure that the form is attested by your employer.
Benefits of Employees’ Provident Fund
The primary benefits of EPF are as follows:
1. To Enhance Your Retirement Savings
EPF forces you to save and create a sizeable corpus for your post-retirement life. Given that 8.33% of your total EPF contribution goes into EPS, you can build a sufficient corpus to financially secure your future after retirement.
2. To Pay for Certain Big-ticket Purchases
EPF funds can be withdrawn partially to meet emergencies or an important big-ticket purchase. Some of the valid reasons you can use your EPF funds are to buy or build a house, pay for medical expenses, or meet your higher education expenses among others.
3. As a Sort of an Unemployment Benefit
In case of unemployment, you have the option to withdraw your EPF savings. The current provisions mandate that you can withdraw up to 75% of the corpus after one month of unemployment and up to 25% if you remain unemployed after two months.
4. To Financially Secure the Life of Your Loved Ones
In the unfortunate event of your demise, your nominee can claim your entire EPF savings. Therefore, it could act as a financial lifeline for your family in your absence.
5. To Maximise Your Tax Savings
Under Section 80C of the Income Tax Act, contributions to your EPF are tax-exempt up to a limit of ₹1.5 Lakh per annum.
Employees’ Provident Fund (EPF) Eligibility
- Any business with more than 20 employees must mandatorily extend the EPF services to their employees
- This scheme is available to all employees – even those working for organisations with employee strength of less than 20. However, in this case, the enrollment will be considered to be voluntary
- An employer must register for EPF within a month of employing more than 20 employers. Failure to do so could result in heavy penalties
EPF Withdrawal Rules
A member may be able to withdraw his EPF savings partially or fully, based on certain conditions as follows:
Full Withdrawal
- If a member retires either upon reaching an age of 58 years or if he retires early, provided he is at least 55 years of age
- If the joining date for your new job is at least 2 months after the last date at your previous organisation
- If you are unemployed for more than 2 months
- In the unfortunate event of death of the member, the nominee can withdraw their EPF savings
Partial Withdrawal
- To repay a home loan
- To renovate one’s home
- To pay for higher education expenses
- To pay for wedding-related expenses
- To construct a house or to buy a parcel of land
- To meet medical expenses
- Up to 90% of the total savings one year before retirement, provided the member is at least 55 years old
How to Register EPFO Grievance?
Step 1: Visit the EPF i Grievance Management System
Step 2: Choose the relevant ‘Status’ option
Step 3: Enter your UAN number, the captcha displayed on the screen, and finally click on the ‘Get Details’ button
Step 4: Now, click on the ‘Get OTP’ button after your UAN details are displayed
Step 5: Enter the OTP in the highlighted space and click on ‘Submit’. On successful OTP verification, you will get a pop-up message. Click on ‘Ok’ to proceed
Step 6: You will be prompted to enter personal details, such as name, state, pin code, country, and gender among others
Step 7: Click on the PF Account number shown in the “grievance details” column
Step 8: Now, select the complaint type and enter the relevant description. You will also have the option to upload supporting documents. Click on “Add” after entering the complaint and uploading the supporting documents
Step 9: Now, you will be able to see your complaint in the “Grievance Details” section. Click on “Submit” to formally register your grievance
Step 10: Once your complaint is registered, you will receive an email and SMS confirmation pertaining to the same
How Can Employers Register for EPF?
Step 1: Visit the EPFO website and click on ‘Establishment Registration’.
Step 2: You will be redirected to the Unified Shram Suvidha Portal (USSP) page. Click on ‘Sign Up’.
Step 3: Once you click on ‘sign up’, you will be asked to enter your name, email ID, and mobile number. Once you add the mobile number, you will receive a verification code. Enter the code in the relevant field.
Step 4: After that, log in to the USSP and locate the ‘Registration For EPFO-ESIC v1.1’ option.
Step 5: Choose the ‘Apply for New Registration’ option. You will be shown two options –
1. Employees’ Provident Fund and Miscellaneous Provision Act 1952
2. Employees’ State Insurance Act 1948
Step 6: Click on ‘Employees’ Provident Fund and Miscellaneous Provision Act 1952’ and then Submit.
Step 7: In the registration form for EPFO, enter details, such as branch division, employment details, establishment details, and more.
Step 8: To conclude the process, add your digital signature.
Once your request has been registered, you will receive an email from USSP.