All You Need To Know About PF Withdrawal Limit

Several EPFO regulations governing withdrawals from the PF account in 2022 have been changed. These changes are intended to make it simpler for subscribers who are struggling financially as a result of the coronavirus outbreak to access their PF money.

Owners of PF accounts can now submit withdrawal requests online up to 75% of their account's net balance or three months' worth of their base pay & dearness allowances, whichever is less. This is a deposit that is not refundable. To know more about PF withdrawal limit, read on.

What Are The Conditions Under Which An Individual Can Withdraw?

You are able to withdraw money from your account under the provisions of the EPF plan for a number of different reasons. You can begin taking withdrawals from your EPF account after you turn 55. You may, however, withdraw funds from your EPF account before retirement as well for a number of reasons. If there is any due money, you can also file a claim.

Following are the conditions under which an individual can withdraw -

1. Academic Prospects - If PF account holders want to pursue further education or if they want to pay for their own children's education after they have completed the 10th grade, they are permitted to withdraw about 50% of their total employee contribution from their individual accounts. A PF account will become transferrable once you have made contributions for seven years.
2. Unemployment - Any individual who is an account holder and hasn't had a job for more than a month is eligible to take up to 75% of the account's corpus. They are also allowed to take a withdrawal of the remaining 25% of their PF corpus if their unemployment lasts longer than two months.
3. Specially-Abled Individuals - Specially-abled individuals are permitted to take money out of their EPF account to pay for their equipment in accordance with the revised provident fund withdrawal guidelines for 2022. They are permitted to take up to six months' worth of basic pay plus DA or dearness allowance, or the employee's portion with interest. This new restriction has been put in place for PF withdrawals in 2022 in order to lessen the financial strain of buying pricey equipment for those with special needs.
4. Residential Properties - In accordance with the PF withdrawal guidelines, workers may make an early withdrawal to purchase vacant land or prefabricated homes. In this instance, the EPFO has also established a withdrawal cap. In this instance, the maximum withdrawal from the accumulated money in your PF account (including employee and employer contributions) is the basic pay for 24 months plus a dearness allowance.
5. House Renovation - The new Provident Fund regulations also include a provision allowing workers to take their basic pay, a 12-month dearness allowance, as well as their share and interest, in order to upgrade, enlarge, or repair their homes.

What Are Some Things That One Should Be Aware of To Avoid Situations Where Withdrawals Become Difficult?

There are many reasons why you might wish to withdraw money from your pension fund before retiring, but there are also occasions when doing so might be challenging.

Following are some of the things that one should be aware of to avoid difficult situations where withdrawals can become difficult -

1. You must send only clear scans of your cheque book or passbook.
2. Verify that your bank account information and IFSC code were accurately entered.
3. Make sure your account has a sufficient balance because, per the rules, an employee can only withdraw PF after making contributions for at least three months.
4. To make the procedure simple, make sure that all of your papers are presented correctly and in accordance with your UAN.
5. You must make sure your UAN is active both before and after quitting your work.
6. Keeping your cell number active for UAN registration is also a good idea.
7. It is also crucial to have the UAN number associated with the Aadhar Card, PAN, and other KYC information.

Endnotes

Any EPF account holder might lessen their tax obligations on early PF fund withdrawals. For those who work in the organised and private sectors, the revised EPF withdrawal restrictions have improved the system's benefits.

Also read: What Is The Vesting Age For Retirement Plans?

Tax Benefits In Retirement Plans