It is very important to do this work of PF, otherwise there will be loss
EPFO Money: If you have already left the job before retirement or have lost the job, then there is a need to be cautious about your EPF. You should know that how long will the interest be available on the money deposited in it. Along with this, there is also a question whether the interest received after leaving the job will remain tax free. In this news you will get answers to all those questions. Actually, many people often forget to transfer their Employee Provident Fund (EPF) after leaving their job. If you are also doing the same then it is a big mistake. There is no interest in the account after 3 years of leaving the job.
don’t make this mistake
Most of the people who leave the job understand that even if they are not investing in their PF account, their deposits are increasing due to interest. We would like to tell you that for the first 36 months, if no contribution or amount is deposited, the PF account of the employee was put in the category of Inoperative Account. In such a situation, you must withdraw some amount before three years to keep your account active.
Under the existing rules in the country, if the employee retires at the age of 55 and does not apply for withdrawal of the deposited amount within 36 months, then the PF account will be inactive. In simple words, even after leaving the company, interest will continue to accrue on the PF account and will not become inactive till the age of 55 years.
interest is taxed
According to the rules made by the government, the PF account does not become inactive if the amount is not deposited in the account, but the interest earned during this time is taxed. If the claim is not made even after the PF account is inactive, then the amount goes to the Senior Citizens Welfare Fund (SCWF). However, the unclaimed amount is transferred to this fund after the account has remained dormant for seven years. Let us tell you that the trusts which are exempted through section 17 of the EPF and MP Act, 1952 also come under the purview of the rules of Senior Citizens Welfare Fund. They also have to transfer the account amount to the welfare fund.
There is a provision to claim the amount
The unclaimed amount transferred to the PF account remains lying in the Senior Citizens Welfare Fund for 25 years. During this, the PF account holder can claim the amount. There is not much benefit in leaving your PF amount with the old company as the interest earned during the period of non-employment is taxable.
Don’t let the account become inactive if you retire at 55. Withdraw the final balance immediately. PF account will not become inactive till the age of 55 years. Still it is good to transfer PF balance from old institution to new institution. This will raise a decent amount on retirement. Even if you are changing your job and do not link the old EPF account with the new one, even after 3 years the interest in the old account will stop. In such a situation, give Universal Account Number (UAN) in the new office so that this problem does not arise.
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