What Happens to Your 8.33% Provident Fund if You Resign After 2 Years?

What happens to 8.33% of P.F. if an employee resigns from the company after working for around 2 years? Will he receive that amount if he withdraws, and what if he wants to continue the account?

In the case of an employee resigning after approximately 2 years of service, the 8.33% of the Provident Fund (P.F.) accumulated during that period would typically be available to the employee. If the employee chooses to withdraw this amount, he would receive it as per the withdrawal rules of the Provident Fund scheme.

However, if the employee wishes to continue the account and not withdraw the funds, he can do so by leaving the amount in the Provident Fund account. This would allow the funds to continue accumulating interest and be available for withdrawal at a later date as per the rules and regulations of the Provident Fund scheme.

It's advisable for the employee to consider the long-term benefits of keeping the funds invested in the Provident Fund account if possible, as it can serve as a retirement savings vehicle and provide financial security in the future.

Hi Venkateshwara Rao,

Yes, definitely you can withdraw the amount if you want to continue. However, you will lose your amount.

Thank you for your response. Could you please provide a detailed explanation if I decide to continue with the account? Specifically, I am interested in understanding how the 8.33% is carried forward in addition to the 12%. I would like to know the actual procedure. For instance, if a person resigns from their current job after one year, is there a specific time limit within which they can withdraw that amount, especially if they change jobs frequently.

You will get it back if you want to discontinue that account. Only in case if your contribution period is less than 6 months, you cannot withdraw that 8.33% contribution towards the pension fund.

Thank you, Atul, for this valuable information.

It means that if a person worked in this particular organization for less than 6 months, then he or she can't withdraw that 8.33% pension fund contribution. Am I right?

Regards,
Reshma

If a person worked less than 6 months, then he can withdraw only PF (3.67% & 12%) amount and not the Pension amount (8.33%). If you changed jobs, you may withdraw the amount or continue by transferring the account (Form 13).

8.33% goes towards the pension fund, which is added to 1.17% of the GOVT. OF INDIA contribution. If you have contributed for more than 6 months but less than 10 years and are no longer in employment, you can claim either the withdrawal benefit (which carries a very good interest rate) or opt for a scheme certificate and surrender your S.C once you join somewhere to have your pension particulars added to your new service.

It is always advisable to get a scheme certificate rather than a withdrawal benefit so that you can claim a pension after 10 years or even during interrupted services. Also, if you have not withdrawn your pension fund contribution, in the case of death, widow and children's pension will start (it's like holding insurance).

If you are moving to another company that has a P.F., it is a legal liability to transfer your P.F. and pension particulars to your new employer.

P.F. and withdrawal benefits before the age of 58 are allowed only when you have been unemployed for more than 2 months.

I hope this clarifies your doubts.

Rajanikant Mishra

We are a company of 19 employees currently, and we are registered as a Private Limited Company. Currently, we do not have a Provident Fund for our employees. I would like to know if it is mandatory to have a Provident Fund or if it is not required. Additionally, could you please advise on the steps to take to start a Provident Fund for our employees?

Thanks for the detailed information, Rajinikanth. Suppose I resigned, opted for withdrawal, and filled forms for the withdrawal of P.F. Specifically, do I need to fill out any forms for Employer P.F, or is it included in the forms already filled? Is there a possibility that the Employer might engage in fraud by not paying that amount? If there is a chance, what are the rules regarding this?

Please explain if 10 years of service are completed, what will be the pension and how is it calculated?

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If you have any more questions, feel free to ask.

The 8.33% component of PF is also called pension contribution. It comes from the employer's pool of 12%. Since it is intended to be an instrument of social security, it is this element that gives you a pension at the time of retirement or to the family in the event of the death of a member.

In case a member leaves service with less than 6 months of service, this amount is forfeited. However, its equivalent can be encashed after resignation if the service is more than 6 months but less than 9 years 6 months. In the case of service of more than 9 years 6 months, which is rounded off to 10 years, you become eligible for a pension. In this case, the 8.33% component is not encashable. You receive it in the form of a pension on completion of 58 years of age.

Hi,

You can withdraw the fund anytime after two months of a non-contribution period. All you need to do is walk to your ex-employer's HR/Finance department and provide the PF PS withdrawal form (forms 10C and 19) with two revenue stamps (re.1). Then you will receive the form back, duly attested and completed by the employer, along with form 3A (in case of resignation in the current financial year). If you do not withdraw immediately after resigning, you can speak to the HR department later.

You can withdraw anytime after two months of a non-contribution period, even if you don't withdraw for 5-6 years. In that case, you will receive interest at 8.5% p.a. from the employee provident fund office on the Provident Fund.

P.S. However, I confirmed the same with the policies. But in case anything is not correct or up-to-date, please let me know.

Good Evening,

I am familiar with the PF in the case of IR. I will research the same and will inform you as soon as possible.

Respects & Regards,
Hansjeet

Please let me know if you need further assistance or clarification.

Yes, he will get the PF 8.33% share. In case of a duration of service less than 6 months, in that case only he will not get this 8.33% share money.

Narendra Prasad

My advice is to continue the same even if you join another organization instead of withdrawing the amount. Continuity is permissible by making a simple application with some documents about your release and joining of the new employer.

Out of employer contribution, to the extent of 8.33%, goes towards the pension fund, and to this further 1.17% is added by the Government of India. In case an employee has contributed for more than six months but less than 10 years and becomes jobless, they then become eligible to claim either withdrawal benefit or opt for a scheme certificate. The scheme certificate obtained can be surrendered after joining a new job so that contributions towards the pension under the same account continue, resulting in an attractive pension after retirement.

Upon attaining the age of 50, if an employee decides to quit, they can apply for reduced pension by submitting Form 10D. However, it is always advisable to obtain a scheme certificate instead of withdrawing, enabling oneself to claim the pension even after 10 years of interrupted services. If the contribution to the pension fund is not withdrawn, in the event of an unfortunate incident (such as death), the widow of the deceased and children will be entitled to the pension.

- Kashinatham Chitturi

Yes, Mr. Atul Kudhuliya is correct. You can withdraw 8.33% if you have completed a 6-month contribution period. Please fill out form no. 10-C (Employees' Pension Scheme).

Amit Insha

Hi Mr. Venkateswara Rao,

Regarding your query about withdrawing only the EPF account but not the EPS account, yes, you can withdraw only the EPF account by submitting Form 19. For the EPS account (i.e., 8.33%), you may either continue with it or transfer the amount to your present working organization. You can obtain a scheme certificate from the concerned regional provident fund officer.

Dear Friend,

I also agree with all, but at the same time, why did they lose the amount if they will transfer to another (13R) firm? An employee who works only 6 months will get 8.33%.

Thanks

Hi Mr. Venkatesh,

8.33% goes to Pension. If you are a PF member for more than 10 years, you will get a pension amount from PF authorities after completing 58 years of age. Before completing 10 years, you can also get a Pension amount while withdrawing the PF claim amount. Please refer to Form 10C, Sl. No. 8 - Are you willing to accept the Scheme Certificate in lieu of withdrawal benefit? If you tick NO, you can also get a Pension amount.

MANOKAVIN

Hello, Mr. Rao,

If it is only 2 years, there is no need to worry. He has two options: to submit Form 10C and get the amount back, or to retain the same account and use it with the next employer. In any case, the amount is safe. There is no need to worry about this.

Dear Venkateswara,

The answer to your query is absolutely "YES." If an employee has resigned from the services of the company and has applied for PF withdrawal, he has to fill Form No. 19C and 10C. Form 19C is for PF amount withdrawal, i.e., 12% + 3.67% (employer's share), and the rest 8.33% contributed by the employer towards the pension fund will be remitted through a cheque to his bank account through Form 10C.

If the employee has resigned and has joined another organization, this PF contribution from both sides can be transferred on submission of Form No. 13 to the RPFC, duly signed and authenticated by the authorized signatory.

I hope I have succeeded in resolving your doubts.

Regards,
Amit Anand Gera

Dear All employees,

The PF employer contribution is 12% of Basic Salary, and the employee contribution is also 12% of Basic Salary. The Employer EPF contribution is 3.67%, and the Employer Pension contribution is 8.33%. The total employer contribution is 12%.

Regards,

Guneet Kaur
Manager-H.R

Hi All,

Will you please let me know how one can obtain the scheme certificate.

Regards,
Prasad

Hi friends,

In this regard, I will start with the contributions of employees and employers.

Employee contribution on (Basic+FDA) = 12%; it will directly go to the PF Fund.

Employer contribution on (Basic+FDA) = 12%; out of this, 8.33% goes to the Pension Fund (the maximum is 541, and the remaining amount will be added to the PF fund). The remaining 3.67% will go to PF as an employer contribution.

Apart from this, 1.61% on (basic+FDA) is for paying Edli, PF Admin, and Edli Admin.

If a person joins and leaves within 6 months, they will receive only their contributions to PF and the employer's contributions but not the Pension amount. If they stay beyond 6 months, they can claim the total amount of PF by applying with Form 19. In the case of the pension amount, if you desire a pension certificate, you can request it; otherwise, you can choose to receive the payment by selecting the option in Form 10C.

Once a person leaves the company, the PF code number will be closed. If they rejoin the same company, a new PF code will be assigned.

Regards,
Sandeep Gorre

The employer contribution (12%) is divided into 2 parts: 3.67% for PF and 8.33% for the Pension Fund. The 8.33% is deposited into a separate account known as the Pension account. When an employee resigns or leaves a job, the following criteria apply to the 8.33% (Pension Fund). Regarding the PF (3.67%), the employee can withdraw the money in full settlement after 2 months of resignation using Form 19.

1. If the employee's service or contribution to the pension fund is less than six months at the time of leaving, withdrawing from the pension fund is not allowed.

2. If the service period is more than six months but less than 10 years, the employee can withdraw the total amount in the pension fund using Form 10C, or opt for a Scheme certificate (also through Form 10C). With the Scheme Certificate, the employee can transfer the Pension Fund to the next company where they have the Pension Fund by surrendering the Scheme Certificate through Form 13.

3. If the employee's service is more than 10 years, the pension fund will not be refunded. The employee can only avail the Scheme Certificate (SC). They can transfer the SC to their next company or surrender it after reaching 58 years to receive a pension through Form 10D.

For further clarifications, contact me via mobile +919894623037 or email me at rmaniv@gmail.com.

Hi all,

My question is, if a person has opted to transfer their account to a new employer, but after 2 or 3 years, they discover that the previous amount of PF has not been transferred, what can they do to retrieve that amount if they now wish to withdraw it?

The answer that has been received is still not clear to me. Can I get further clarification on it.

Hi Madhu,

If, in case, a person opts for PF transfer but somehow the transfer does not complete, then the person can go ahead and withdraw or send a new request for the transfer of the funds. If a person wants to withdraw the funds (PF and PS), they will need to fill out Form 10C and Form 19 for withdrawal. However, if the person wants to continue the same account with the current employer, they will have to fill out Form 13 and submit it to the current employer's PF personnel. If Form 13 needs to be completed, make sure that you or the person submitting it provides more than one copy, as sometimes the PF office unintentionally loses it.

Let me know if this is not the answer you were looking for.

Thanks.

My earnest advice is to please close the PF account every time you leave a company. File claim forms 10c/19 and encash it. There have been many cases where the transfer has not happened, and the employee had to run from the previous employer to the RPF office. Why keep your money there for a debatable interest rate? If it is with you in the bank, it would be of use.

"A bird in the hand is worth two in the bush." I am not discouraging, just handling practically.

Regards,
Chandru
Consultant

[QUOTE=madhuu;923288]
Hi all,

My question is, if a person has opted to transfer the account to the new employer, but after 2 or 3 years, they find that the previous amount of PF has not been transferred, what can they do to get that amount back if they now want to withdraw it?

Madhu,

Form-13: Delay in the transfer of PF account has occurred and is still happening. If all employers have excellent quality, systems, and operational standards, then there won't be any problems. That is why you have to close the PF account whenever you leave a company. Recovery can take a long time, and you have to follow up continuously. To avoid this, it is better to encash it. If you think you may spend all you have in the bank, the only solution is to have better control over yourself.

Regards,
Chandru

Can I get all 24%, or only 3.67% + 12%, if I resign after 10 years? And what will be the percentage of pension each month?

Thank you.

Thank you, Chandru, for the suggestions. Actually, my friend had withdrawn the PF amount from her second employer and, in doing so, found that the PF amount from her first employer was not yet transferred. I guess there will be a lot of running about that's going to happen now to get the amount back. But thank you once again!

I also agree that the Act states that any employee whose service is greater than 6 months can receive the full amount through Form 10C, 19 EPS, and EPF, respectively. If the service period is less than that, only the option to transfer the account is available, nothing else. However, the employer should not interfere in that.

Regards,
Suku
9842023923