Gone are the days when an individual spent most of his working years with a single employer and retired from the same company. With most of the jobs being created in the private sector, job changes have become the norm than an exception. And with job changes, change of workplace from one city to another is also fairly common.While changing jobs means enough paperwork to get relieved, collect dues and join elsewhere, employees should not also forget an important component of their benefits package. This is the mandatory contribution into the Employees Provident Fund. This can be transferred from the old employer’s account to the new one.
Why transfer PF and not close it?
While changing jobs and joining a new employer, an employee has an option to close the old PF account and open a fresh one. But it is wiser to transfer the old PF account funds to the new one. Earlier, the transfer involved some paperwork, like submitting the transfer form from an old employer to the new one, but with launch of an online self-service portal by EPFO this has become easier and hassle-free.
Advantages of EPF Transfer:
- While closing an old account before 5 years, the amount becomes taxable. But if you simply transfer the funds, you get to enjoy your hard earned money in full.
- You can avail partial withdrawal on your PF funds for reasons like purchasing/constructing a house, medical treatment, marriage of own or daughter etc.
- You earn the prevailing rate of interest from EPFO, in the long run this becomes a substantial sum due to the power of compounding.
EPFO estimates say Rs.22,000 crores were lying with the organization as of March 2013. Since these accounts were dormant for three years, they were not earning any interest too.
How to go about PF Transfer?
The EPFO had always allowed fund transfers. But it was time consuming and cumbersome since an employee had to get a Form 13 signed by his ex-employer and submit to the present employer. Also the form had to be sent by post and could get lost or misplaced. There was lot of discontent among employees and therefore it explained the dormant accounts lying with EPFO.
However, things have started changing radically after EPFO launched an online, self-service portal on 2 October 2013 for online transfer of funds. Already, over 1.15 lakh employees have applied on the portal to transfer their PF funds. While, 90,000 claims out of this has been settled, about 8,900 have been rejected. Hence, the success of online PF transfer is very high. For ease in transferring funds online, EPFO in July 2013, introduced a revised Form 13 . This can be submitted to either the present or to your previous employer. Earlier, the employee had to submit it only to the previous employer. But, if the present employer falls under the exempted category (that is maintains a trust), then the form can be submitted only to present employer. They have also launched a Universal Account Number that links a particular member to a particular account and facilitates its portability when the member changes employers.
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Step-By-Step Guide for Online Transfer of PF Funds
Here is a step-by-step guide to how you can log into the EPFO portal and facilitate the transfer of your PF funds from one employer to another.
If you have already been assigned a Universal Account Number, you can transfer funds easily. Ask your employer for UAN, if you haven’t got it.
- Go to the EPFO website at http://members.epfoservices.in/home.php and create your UAN based login ID.
- This will take you to a page where you have to enter your UAN, mobile number and details of current employer like state, establishment number and account number.
- Then you need to check if account is eligible for a transfer on the EPFO site. You need to fill in the state where the employer was located and search by name or establishment number from a dropdown menu.
- After you have filled in the details, click on Check Eligibility.
- The site will then let you know if your account is eligible, or not. If it is, then you can register on the EPFO website.
- You have to submit a valid photo ID such PAN card, Aadhaar or driving licence. The website will also send a PIN to your mobile which you have to verify.
- Submitting the PIN successfully will give you a confirmation message. Continue further.
- This will take you to the EPFO Member Claims Portal, To log in you have to provide the document ID and phone number. After signing in, you can see all options.
- Go to the top tabs and click on Request for transfer of account.
- You can now access and fill in PF transfer form. It has three broad parts:
- First, you have to enter personal information in the first part. Other than your name and email you have to enter IFSC code of the bank and your salary account number.
- In second part, fill in details of your old PF account
- In part three, fill in details of current PF account.
The claim can be attested by your previous or current employer. It takes some time for their end to do it.
You can also check the status of your funds transfer through the portal. In case of any hitches you may enquire at the previous/ current employer end or write to EPFO directly.
This is how easy, the funds transfer of PF has become through the online portal.
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