The EPFO (Employees' Provident Fund Organisation) recently allowed its members to withdraw upto 75 percent of their EPF (Employees' Provident Fund) account balance in case of unemployment of members for over one month. However, there are several other reasons for which one can exercise the option of partial/full withdrawal of the PF account balance. As per the current rules, 100 percent withdrawal of EPF account balance is permissible when the member is unemployed for over two months. There are, however, several reasons allowed wherein you can withdraw the partial PF account balance, and for which, the EPFO member should not be rendered jobless.
The EPFO members are allowed to seek advances/withdrawal from their EPF account for the purposes that include purchase or construction of house, repayment of loan, for marriage of self or daughter or /son or brother as per the provisions of Employee Provident Fund (EPF) Scheme 1952. In all these instances, the employees must have worked for a specified period (5 to 7 years) to become entitled to claim the withdrawal.
In certain cases, however, there is no prerequisite for the employees to have worked for a specified period to be able to claim the PF withdrawal/advance. These exceptions include lockout or closure of factory, illness of member, natural calamity, cut in electricity in establishment and purchasing equipment by physically handicapped person, as per the information given on EPFO's official website: epfindia.gov.in.
EPF Withdrawal Provisions. Five Things To know
1. For Treatment of illness: An EPF member can withdraw up to six months of basic and dearness allowance (DA) or their entire contribution, whichever is least for the treatment of his/her own illness or treatment of family members. To withdraw money for the treatment, employees are not mandated to have served for a minimum number of months/ years.
2. For Marriage: For the purpose of marriage of self/ daughter/son/ brother/sister an EPFO member is allowed to withdraw up to 50 per cent of their share with interest. He/she must be an EPFO member for at least seven years (84 months) to be able to apply for this advance.
3. For Higher education of son/daughter: The EPFO allows a withdrawal of 50 per cent of an employee's share with interest for post-matriculation studies of their children. He/she must be an EPFO member for at least seven years (84 months) to apply for this advance. A certificate regarding course of study and estimated expenditure from the head of institution is meant to be submitted to avail this advance.
4. For Purchase or construction of house/flat: EPFO allows its members to withdraw up to two years of basic wages and dearness allowance (DA) for purchase of land. For purchase of house or flat or construction, employees are allowed to withdraw 36 months (three years) of basic wages and DA, or total of employee and employer share with interest, or total cost of the house/construction, whichever is least.
One must remember that there is a minimum threshold of being an EPFO member for five years (60 months) to be able to seek a withdrawal for construction of house. The employee is entitled to withdraw only once for this purpose during entire his/her employment. Barring a declaration from the employee, no other document is necessary to process this advance request. Likewise, an employee can take loan for improvement/repair of an existing house owned by him or his spouse or joint-owned property.
5. For repayment of loans: EPFO enables the employees to withdraw upto three years 36 months (3 years) of basic wage and DA or accumulated shares of employee and employer with interest or total outstanding principal and interest, whichever is least for repayment of loans in special cases. One has to be an EPFO member for a minimum of 10 years to be able to avail this advance. An employee requires a certificate indicating the outstanding principal and interest to be able to apply for this partial withdrawal.