- By Aditya Pratap Singh
- Mon, 14 Apr 2025 11:59 AM (IST)
- Source:JND
EPF Withdrawal Rule: For financial stability, particularly in difficult times, employees do try to withdraw funds from their Employee Provident Fund (EPF) savings. The Employees' Provident Fund Organization (EPFO) oversees the EPF account, which grows significantly over time thanks to consistent contributions from the employer and employee. Receiving less money during withdrawal than what is shown in their passbook, however, is a common complaint among employees. Here's a thorough examination of the causes of this.
Early Withdrawal TDS Deductions
The deduction of Tax Deducted at Source (TDS) is one of the primary causes of this discrepancy. The amount becomes taxable if an employee takes money out of their EPF before they have worked continuously for five years. If the employee has a PAN card in these circumstances, a 10% TDS is assessed. The TDS rate can rise to 34.608% if a PAN card is not present. Smaller withdrawals are exempt from TDS, though, if the total is less than Rs 50,000.
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Technical Delays and Pension Funds
The Employee Pension Scheme (EPS) receives a portion of the EPF contribution in addition to taxes; this amount is not shown in the withdrawal amount. Inconsistencies may also arise from delays in moving funds from previous PF accounts to the new ones. Technical issues can occasionally prevent the passbook from being updated on time, which can lead to misunderstandings regarding the true balance.
You Must Understand the Withdrawal Rules
Partial or total withdrawals from the PF account are prohibited while an employee is employed. But the rules are different when it comes to unemployment. After one month of unemployment, a person is eligible to withdraw up to 75% of their EPF balance. The remaining 25% may also be withdrawn if unemployment lasts for two months or longer. TDS may be applicable even in these circumstances, which would lower the total amount received.
How to Make Sure Your Withdrawal Goes Well
Employees are encouraged to update their passbook and make sure all required forms, especially Form-19 and Form-10C, are accurately completed and submitted before beginning a withdrawal. The Umang app, a missed call, or EPFO's SMS services can all be used to check an employee's EPF balance.
Employees can plan more effectively and steer clear of unpleasant surprises when making EPF withdrawals by being aware of these guidelines and procedures.
