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The amount deposited in PF is a big help for the employees working in the organized sector. Employees withdraw money from their PF account when needed. Employees Provident Fund Organization (EPFO) provides the facility to withdraw money for different needs. Let us tell you that the main objective of the EPF scheme is to financially secure the post-retirement life of workers working in the organized sector through assured retirement fund and pension. However, employees can withdraw funds from their EPF account partially or completely even before the maturity of the scheme. However, recently EPFO has changed the withdrawal rules. After this the tax burden has increased. Let us know what is the new rule of EPFO?
New EPF Withdrawal Rules 2024
Under normal circumstances, if you keep doing a regular job without any break or gap, you cannot withdraw the provident fund before retirement. However, partial withdrawal of funds is allowed in certain circumstances, such as medical emergency, higher education and buying or constructing a house. If an employee loses his job, he can withdraw 75% of EPF after one month of unemployment and the full 100% after two months. But for this the employee will have to declare unemployment.
When will 30% tax be paid on withdrawal?
For partial or complete tax-free withdrawal of PF funds, it is mandatory that the PF subscriber has completed 5 years of contribution under the EPFO scheme. However, if the withdrawal amount is less than Rs 50,000, no tax will be payable. If the EPF withdrawal amount exceeds Rs 50,000 within five years of account opening, the EPF subscriber will have to pay TDS of 10 per cent, provided he has a PAN card. Without PAN, this tax liability becomes 30 percent.
