EPFO: Most of the employees in India have PF accounts open. PF accounts are kept under the leadership of EPFO. This account is considered a savings scheme. Employees collect a huge amount in this account. 12 per cent of the employee’s salary is deposited in the PF account. Not only this, but there is a provision for PF employees to get a pension every month after retirement.
Under EPS, a pension is available every month, which proves to be a support for the blind in old age. Many employees withdraw the entire amount from their PF account as soon as they change jobs. Do you know that this is not right? It can cause a big loss in the future. Employees can also be duped heavily by this.
What will be the big loss by withdrawing from PF?
The central government announces interest for PF employees every year. For the financial years 2024 and 20so, the central government had announced to give 8.25 per cent interest. The interest increases the amount of PF of the employees. If you withdraw the money as soon as you change jobs, then you will not get the benefit of interest.
If someone deposits money in a PF for 10 years and withdraws it in between, then the fund will reduce considerably by the time of retirement. If an employee withdraws the fund before 5 years, then he will have to pay tax as well. Overall, employees should not hurry to withdraw PF money when they change jobs. Otherwise, there will be a big loss.
What to do when you change jobs?
If you leave a job with a company and go to another place, then the employee has many options. In such a situation, the employee should get the PF money transferred to the new company. This process has become very easy with digitalisation. Money can also be transferred in a few clicks through the online UAN portal. This will keep the Provident Fund balance and interest amount continuously added.
Along with this, you will get a large amount easily after retirement. The most important thing is that there is a contribution of the employee and the company to the PF account. 12% of the employee’s salary goes to the PF account.
The company also contributes only 12% to the PF account. Out of this, 8.33% is directly transferred to the EPS fund. Apart from this, 3.67% goes to the PF account.
