Employees’ Provident Fund Organisation (EPFO) has introduced new rules regarding partial withdrawals from the Provident Fund for the purposes specified under three categories: Essential needs, Housing-related needs, and Special circumstances.
An emergency seems uncalled for and may pop up at the most unexpected times, arising out of financial needs for education, housing, health or something else. To navigate through such situations and make use of the savings, EPFO gives the provision of partial withdrawal from the EPF available to the subscriber.
As per the latest framework, the EPFO has clarified the rules for EPF advances, describing the frequency of their withdrawal and the purposes those advances must pertain to.
— Essential needs
Illness: For health-related emergencies and other medical expenses of oneself or the family members specified by the EPFO, there is no limit to the number of times the withdrawal can be made.
Education: In case of education-related expenses, a person is allowed to withdraw up to 10 times from the total EPF balance during the entire membership period.
Marriage: A person may also withdraw money for marriage-related expenses of self or the family members up to 5 times during the entire period of EPF membership.
— Housing-related needs: A subscriber may withdraw an amount from their EPF account for up to 5 times during the period of EPF membership for the following purposes – Purchase of a house, flat, or plot; construction of the house; repayment of home loan; renovation, alteration or improvement of the house/flat.
— Special circumstances: A subscriber is allowed to take an advance from the EPF for up to two times in a financial year for certain special circumstances notified by the Central Board of Trustees (CBT), EPF.
The members were earlier required to clarify the reason for partial withdrawal under special circumstances, which may include natural calamity, continuous unemployment, epidemic outbreak, etc.
The users must note that they are allowed to withdraw 75 percent of their EPF balance, including the employer’s and the employee’s shares and the interest accrued, after completing 12 months of membership.
To make the premature withdrawal, a member is required to use EPF Form 31. The Form can be submitted online through the EPFO Member e-Sewa portal or physically by visiting the concerned EPF office. It is important that Aadhaar, PAN, UAN, and bank account details are correctly linked to avoid any discrepancy.
