Schemes Offered Under EPFO

Given below are the three schemes that are offered under EPFO:
1.Employees' Provident Funds Scheme 1952 (EPF)
2.Employees' Pension Scheme 1995 (EPS)
3.Employees' Deposit Linked Insurance Scheme 1976 (EDLI)

Objectives of EPFO

The EPFO’s primary goals are as follows-

1.To ensure that each employee only has one EPF account.
2.Compliance must be made as simple as possible.
3.Ensure that organizations follow all of the EPFO’s rules and regulations regularly.
4.To assure the dependability of internet services and to increase their facilities.
5.All member accounts should be easily accessible online.
6.Claim settlement times will be lowered from 20 to 3 days.
7.Encouragement and promotion of voluntary compliance.

UAN and EPFO Portal

1.All EPF subscribers have online access to their PF accounts and can execute operations such as withdrawal and checking their EPF balance.
2.EPFO assigns each member a 12-digit number known as the UAN. Even if an employee changes employers, his or her UAN remains the same. 
3.The Universal Account Number (UAN) simplifies access to the EPFO member portal. When a member’s job changes, his or her member ID changes, and the new ID is linked to the UAN. Employees must, however, activate their UAN to use the services online.

EPF Eligibility

Here are the eligibility requirements that must be met to join an EPF scheme-
1.The Employee Provident Fund is open for employees of both the Public and Private Sectors, which means all employees can apply to become a member of EPF India.
2.Any organization that employs at least 20 individuals is deemed liable to extend the benefits of EPF to its employees.
3.After becoming an active member of the EPF scheme, the employees are eligible to avail of several Employees Provident Fund benefits, including insurance benefits and pension benefits.

EPF Interest

1.For the Financial year 2023-24, the pre-fixed rate of interest offered by the EPF scheme is   8.15%.
2.The interest amount accrued on the investments in a PF online account is tax-free.
3.Such interest is paid only on the operative PF accounts of employees who are yet to retire. But the interest thus accrued on such accounts is taxed as per an EPF employee member’s tax slab.
4.It should also be noted that the share contributed towards Employees Pension Scheme does not accrue interest. However, members are entitled to receive a pension out of this accumulated sum after they turn 58 years old.

Capital Appreciation

The PF online scheme offers a pre-fixed interest on the deposit held with EPF India.
Additionally, rewards extended at maturity further ensure growth in the employees’ funds and accelerate capital appreciation.

Corpus for Retirement

1.Around 8.5% of an employer’s contribution is directed towards the Employee Pension Scheme. In the long run, the sum deposited towards the employee provident fund helps to build a healthy retirement corpus.
2.Such a corpus would extend a sense of financial security and independence to them after retirement. 

Emergency Corpus

1.Uncertainties are a part of life. Therefore, being financially prepared to face such unwarranted situations is the best an individual can do to deal with exigencies.
2.An EPF fund acts as an emergency corpus when an individual requires emergency funds.

Tax-saving

• Both employee and employer contributions towards the EPF are eligible for tax deduction under Section 80C up to a limit of Rs. 1.5 lakh.
• The employee’s contribution, including interest, is exempt from tax under Section 10(11) of the Income Tax Act, and the employer's contribution is also tax-free unless the total contribution exceeds Rs. 2.5 lakh in a year (for high-income earners).

EPF Withdrawal Rules

Individuals may opt for either partial or complete withdrawal of EPF. But such withdrawals can be made only under specific circumstances.
Here is a list of a few such circumstances under which individuals can withdraw EPF completely –
On retirement.
1.If their unemployment period extends more than two months.
2.While switching from one profession to another or in between jobs. But the duration without a job should be more than two months.
Here is a list of a few such circumstances under which individuals can withdraw EPF partially–

1.For a wedding.
2.For higher education.
3.For purchasing land or constructing a house.
4.Repayment of home loan.
5.Renovating a housing property.

Easy Premature Withdrawal

1.If you withdraw your EPF before 5 years of employment, you will be taxed. PPF withdrawals are not taxed.
2.Investment in the EPF is tax deductible up to Rs 1.5 lakh per year under Section 80 C of the Income Tax Act. This is true for both employer and employee contributions. Unless you become unemployed, the interest on your EPF is likewise tax-free.
3.Withdrawals from the EPF are likewise tax-free if made within 5 years of creating the account. TDS is deducted from the withdrawal amount if it exceeds Rs 50,000 within 5 years of the date of opening the EPF account.
4.PPF account investments up to Rs 1.5 lakh per year qualify for a tax credit under Section 80 C of the Income Tax Act of 1961. The interest on the PPF is also tax-free, but it must be reported on the annual income tax return. The PPF maturity amount is likewise tax-free. In other words, PPF is tax-exempt, exempt, exempt.
5.Members of EPF India are entitled to avail benefits of partial withdrawal.
6.Individuals can withdraw funds from their PF account to meet their specific requirements like pursuing higher education, constructing a house, bearing wedding expenses, or for availing medical treatment.