I applied for PF withdrawal by submitting Form 10C and 19 from my previous organization, but they are asking for a declaration from me stating that I am not working with any other company. If I declare the same, they can proceed further with the withdrawal; otherwise, they will transfer the PF to the present company.
If I declare that I am not working anywhere, is it illegal, or are people generally doing the same? Please advise.
Regards,
Pushpraj Anand
From India, Wardha
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If I declare that I am not working anywhere, is it illegal, or are people generally doing the same? Please advise.
Regards,
Pushpraj Anand
From India, Wardha
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This is a really good question. Well, people have a wrong notion that PF transfer is a tedious process, and hence the majority will suggest withdrawing.
One of the clauses for withdrawal is "that you need to declare that you are not working." Many people misuse this feature to get the money without realizing what they are about to lose. This clause of "Disclosure" is actually a "Safeguard clause" by the government to ensure that the "PF" benefit is not discontinued by the beneficiary.
I suggest not withdrawing your PF. If you continue your PF for more than 5 years and above, you will be eligible for "gratuity" and also a good "rate of interest" on the fund in your "PF Account." In fact, I would suggest never withdrawing your PF during your service, except for any emergency. Tax benefits are higher with PF.
I further suggest seeking PF transfer to your new company; it's a saving in disguise. Even if your new company does not have PF (as most new generation companies avoid PF schemes since they do not want to get into this tedious filing work), you should insist that you want PF. All companies under Indian various acts are obliged by law to provide this service if you have an existing PF.
Also, a piece of guidance to all employees: insist on employee PF; it's a saving in disguise that you will realize when you grow old.
All the best.
Regards,
Ukmitra
From Saudi Arabia, Riyadh
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297One of the clauses for withdrawal is "that you need to declare that you are not working." Many people misuse this feature to get the money without realizing what they are about to lose. This clause of "Disclosure" is actually a "Safeguard clause" by the government to ensure that the "PF" benefit is not discontinued by the beneficiary.
I suggest not withdrawing your PF. If you continue your PF for more than 5 years and above, you will be eligible for "gratuity" and also a good "rate of interest" on the fund in your "PF Account." In fact, I would suggest never withdrawing your PF during your service, except for any emergency. Tax benefits are higher with PF.
I further suggest seeking PF transfer to your new company; it's a saving in disguise. Even if your new company does not have PF (as most new generation companies avoid PF schemes since they do not want to get into this tedious filing work), you should insist that you want PF. All companies under Indian various acts are obliged by law to provide this service if you have an existing PF.
Also, a piece of guidance to all employees: insist on employee PF; it's a saving in disguise that you will realize when you grow old.
All the best.
Regards,
Ukmitra
From Saudi Arabia, Riyadh
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Mr. Mitra is right. Generally, HR professionals with little knowledge suggest employees withdraw. However, without any necessity, one should not withdraw their PF. If you transfer your PF and continue this for 5 years, 10 years, or 20 years, you will receive benefits accordingly. PF is for employees' social security, which will secure your future and provide tax benefits, loan benefits, insurance benefits, and pension benefits. Always try to avoid withdrawal.
From India, Delhi
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From India, Delhi
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In PF, there is a law that requires a declaration stating the employee is not working in any other company to withdraw the PF amount. Transfer or withdrawal is the employee's choice, and the employer has no right to decide on it. Moreover, if your employer is adamant about their stance, you can submit Form 10C and 19 yourself. If your employer is not ready to counter-sign your application, it can be done by the manager of your bank, a magistrate, a Gazetted officer, a sub-postmaster, etc.
Even then, according to me, as noted by Mr. Ukmitra, it is better for you to transfer your PF amount to the new company for better benefits.
From India, Kochi
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Even then, according to me, as noted by Mr. Ukmitra, it is better for you to transfer your PF amount to the new company for better benefits.
From India, Kochi
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In practice, most companies demand this. However, this is just a formality since, in the PF/Gratuity withdrawal form, there is a note as below:
Quote:
In the case of submission of an application for settlement under clause (s) of sub-paragraph (i) and in clause (b) of sub-paragraph (2) of paragraph 69 of the EPF Scheme, 1952, the claim should be submitted after two months from the date of leaving service, provided the member continues to remain unemployed in an establishment to which the Act applies.
Unquote
As you will see, the last line of the note clearly implies that the beneficiary needs to be unemployed, and the onus of responsibility is on the organization that submits the form to the PF authority. In order to protect themselves from any future liability, most companies have the same form filled out by the beneficiary who wishes to withdraw the PF/Gratuity. It's just a precautionary step.
Ukmitra
From Saudi Arabia, Riyadh
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Quote:
In the case of submission of an application for settlement under clause (s) of sub-paragraph (i) and in clause (b) of sub-paragraph (2) of paragraph 69 of the EPF Scheme, 1952, the claim should be submitted after two months from the date of leaving service, provided the member continues to remain unemployed in an establishment to which the Act applies.
Unquote
As you will see, the last line of the note clearly implies that the beneficiary needs to be unemployed, and the onus of responsibility is on the organization that submits the form to the PF authority. In order to protect themselves from any future liability, most companies have the same form filled out by the beneficiary who wishes to withdraw the PF/Gratuity. It's just a precautionary step.
Ukmitra
From Saudi Arabia, Riyadh
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Early PF withdrawal won’t be easy.pdf
Guide Lines for PF Withdrawal.doc