Hi, I am shifting out of India to Hong Kong for job. Can I withdraw my entire EPF without having to pay tax on it? In terms of my job history, I opened my EPF in 2010, changed employer in 2014, and then again in 2015. My PPF has been linked across the employers under a single UAN number.
Hi
The withdrawal of PF shall not be taxable.
However, Full EPF withdrawal is not allowed till the age of retirement. The PF account consists of contribution made by the employer, contribution made by employee and interest earned on employer and employee contribution. Now the employer contribution and the interest earned on it cannot be withdrawn till the age of retirement. Employee can only withdraw his contribution and interest earned on it.
Since, you have completed 5 years the amount received is not taxable. It is totally exempt.
If you have served continous for more than 5 years then it is totally exempt. There should not be break of service in 5 years. Transfer from one employer to other employer.
Thanks
Yes, you can withdraw your EPF amount without paying tax on it.
Hi,
Since you have completed 5 years of continuous service without any break, withdrawal of PF will be exempt.
Regards,
Nikhil.
TAXABLE WITHDRAWAL ABOVE 5 YEARS.
Pf is taxable if you withdrawn the amount before 5yr of service. In your case since the requirement of 5 yr is completd so it will be not taxable , however w.e.f from june 2016 you can only withdraw the amount of your contribution and interest thereon. The contribution of your employer and interest thereon can be withdrawn only after the age of retirement i.e 58yr.
In nutshell at the employment what amount deduct from your salary you may withdraw
You can withdraw your contribution along with interest after 5 yrs in job..since you have completed said period of service ,you can do so.
Thanks for your contributions, couple of doubts: a) Some people have mentioned that I can withdraw only my contribution due to change in law w.e.f. Jun'16, and not employer contribution, how true is it? and b) on online forums I read, that I need a certification from a gazetted officer saying that I have been unemployed for a period of two years. Will me taking a job in Hong Kong count as unemployment? Thanks
a) Yes, due to new Rules from October 2016 now you can withdraw only your contribution and interest earned on the same. Employer's contribution can be withdrawn only after retirement age i.e. 58 years.
One of the reason for withdrawal is If the subscriber is wishing to move permanently abroad. I don't find any clause which says certification from gazetted officer is required.
Hi,
Yes please find below the old and new rule regarding this.
Old Rule – If a person leaves the job and remains unemployed for 2 months or more, then he/she can withdraw the entire EPF amount.
New Rule – Full EPF withdrawal is not allowed till the age of retirement. The PF account consists of contribution made by the employer, contribution made by employee and interest earned on employer and employee contribution. Now the employer contribution and the interest earned on it cannot be withdrawn till the age of retirement. Employee can only withdraw his contribution and interest earned on it.
As far as the certification by gazetted officer is concerned it is no more valid now as irrespective of that, you will still not be able to withdraw the employers contribution of the PF and the interest thereon.
Hope that clarifies.
Regards,
Nikhil
You can withdraw your contribution and interest on that. Employer contribution and interest will be available at the time of retirement.
I do have said that you can only take your part of contribution as a PF. Employer contribution can be take only at the time of retirement. I advice you to check thoroughly and also refer to other consultant for certicfication from a gazetted officer as I am unable to coment on this part.
Thank You
Hi,
Out of total accumulated funds, you can withdraw only your part along with the interest. Employer contribution and interest can be withdrawn only at the time of retirement.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
Thanks, looks like I will likely need to personally consult you for the details. As per further checks online, it seems that government had rolled back the new rule that restricted withdrawl of EPF to only the own contribution, see the following: https://economictimes.indiatimes.com/wealth/personal-finance-news/government-rolls-back-restrictions-on-withdrawal-of-provident-fund/articleshow/51896900.cms, and http://www.thehindu.com/business/Industry/Govt.-rolls-back-PF-withdrawal-norms/article14246045.ece. However, my main question is that the EPF says that one can withdraw the EPF only when he is unemployed for at least two months. I will be unemployed in Indian jurisdiction, but will be taking up employment overseas. Will it still count as unemployed within the Indian jurisdiction?
Hi
There's a condition of 2 month's unemployment for withdrawal of EPF. But, since you are going abroad, this condition is not applicable to you. You need to file EPF withdrawal under abroad settlement.
The withdrawal form can be filed online also.
No attestation of gazetted officer required for you since 2 month's condition is not applicable.
No, since you are moving abroad this condition may not be applicable to you.
Regards,
Nikhil.
In my opinion it wil be considered as unemployed, as one of my friend has gone abroad for job: just applied in company for closure of account. The movement company proceed it will show in your account the application is in process and after 3,4 month it will be credited in your account
And alo i dnt think so EPF department may any way come to know about your employment as you are not gonna use your PAN or EPF anywhere in your future employment
I don't think EPF would allow you to withdraw your contribution along with interest as soon as they will be informed you will be in employment bcz purpose of EPF is to provide liquidity at the time of need and emergency. Whether you are employed in india or outside it does not matter.
The provision for remaining unemployed for two months was laid out in Old Rules. Now this provision doesn't exist in the new Rules.
The article which you have referred was published in March 2016 however Rules were amended again and came in effect from 1st Aug, 2016.