PF Withdrawl

POSTED BY Sridhar ON February 6, 2012 9:20 pm COMMENTS (12)

Hi all,
At the outset, let me take this opportunity to congratulate on creating this web jagoinvestor site and sharing excellent information useful for common man.

Here is my question related to EPF withdrawal.
I have worked in a company for 13 years in Kolkata and then joined a second company in Hyderable and worked for 1 and half year. I got my PF transfered to the second company while I was working there. I came back to Kolkata and wanted to take a break in 2009 so I did not withdraw my PF yet. Also I am given to understand that the interest will be credited for 36 months and then no interest will be given. I am now planning to withdraw my PF and therefore I have few questions.

1. Is the amount taxable?
2. The PF withdrawal form should I submit to my company in Hyd or submit in EPFO office in Kolkata?
3. Will I be getting the entire amount i.e. (PF+pension)?
4. If I don’t withdraw pension part will I get pension after my completion of 58 years?
Regards.

12 replies on this article “PF Withdrawl”

  1. HarishNaganna says:

    You are always welcome, so do you know, when the 12% of basic is put from employer, 8.33% is invested in EPS and 3.67% is invested in EPF and also 1.1% is from Govt, so my question is when you do the withdrawl does it show the details ?

  2. HarishNaganna says:

    Hi Ashal,

    I have a query, since he has completed more than 5 years,with the same PF Number, i guess the pf will not be taxable as in the case , when he has transferred the same pf number.

    You had mentioned , that the Kolkata, PF will be tax free and the Hyd PF will be taxable?

    1. Dear Harish, sorry for the goof up. I accept my fault. Yes, as the old PF was transferred to new one, the service ‘ll be counted in continuity & thus no tax at all on Hyderabad PF also.

      Thanks, for pointing out my mistake.

      Thanks

      Ashal

  3. Dear Sridhar, as I said in my prev. reply, the basic amount from Kolkata employer & the accrued interest on it which was transferred to Hyderabad, ‘ll remain tax free. As you had not completed 5Y service with your Hyderabad employer, the basic amount & the interest accrued on it ‘ll be your taxable income. PF office ‘ll not deduct any tax on it. The onus lies on you to declare the same as your income from other sources & pay tax.

    Please do note, as you are not working as of now, I assume your income from salary etc. is almost nil & this Hyderabad PF amount ‘ll be the only income in the FY, so you are eligible for zero tax limit of 1.8L Rs. as well as 80C benefit.

    Thanks

    Ashal

  4. Sridhar says:

    Thanks for your advice Ashal. By the way is the amount taxed and deducted at source or we have to show it as part of taxable income?

  5. Dear Sridhar, as no more fresh input is there from you or your employer, your FPF may also become non operative & in the end no pension at all at the age 25.

    In my opinion, whatever amount you are getting as of now in your FPF & PF, please invest the same for your actual retirement & do not use it for current consumption.

    thanks

    Ashal

  6. Dear BanyanFA, Please read the basic query again. the person in question is already not working since 2009 so the 3Y period is about to complete. So no matter when he ‘ll decide to work again, as of now, he w’d have to withdraw his PF amount to invest elsewhere to earn a bit of interest.

    Thanks

    Ashal

    1. Sridhar says:

      You are right Ashal. Regarding my Q 1 & 4. 1. Will the tax be deducted at source and they send the amount or I will have to show it in taxable income? Can you please get back on my Q4.
      Thanks for your time.

      BanyanFA the link to your blog had useful info though… Thanks for sending.

  7. BanyanFA says:

    Hi Sridhar,

    Your facts are correct. If a PF account is left inactive for more than 36 months, then no interest shall be provided on the PF balance. Hence you should ensure that you keep on consolidating your PF balances from your previous company(s) to your current employer. If you haven’t joined your new employer, you still would have 36 months to join your new job.

    Regards
    BFA

  8. Dear Sridhar, To redeem, first transfer the amount to your EPFC, Kolkata office. then only you may redeem the same. Form 10C is to be used for PF withdrawl. A correction in my prev. reply. If you want to redeem FPF amount also, please fill form no. 19 & submit both these forms to Kolkata EPFC office.

    Thanks

    Ashal

  9. Sridhar says:

    Hi Ashal,
    Thanks for your quick reply. Just so you know I have not joined in a company as of now (after working in Hyd). In future I may. Therefore, in this case I cannot transfer at present. So, in this situation what is the process to withdraw the amount and also about the pension if you can tell me that will be great!.
    Regards.

  10. Dear Sridhar, the original Kolkata PF & accumulated interest there on ‘ll be tax free. The Hyderabad PF amount & accrued interest ‘ll be taxable as you have worked for only 1.5Y.

    Regarding the redemption, if you want to redeem it in Kolkata, first apply to get your PF transferred to Kolkata office & then you may redeem the same.

    No you ‘ll not get family pension fund redemption. But you may get it transferred to Kolkata.

    Thanks

    Ashal

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