What is PF? Its types, interest rates and terms? (Provident Fund in 2023)

What is PF? When you join a job in a company where the number of employees working is more than 20, then you are asked to open a PF account after a short period of time. This PF account company automatically opens on the basis of your required documents.

In such a situation, you think that what is this PF account and why the company deducts a fixed amount every month from your salary after opening the PF account.

Explain that after deducting the money in PF account, when you retire from the job then you get the money. Well if you do not know about PF then today in this article we will get complete information about PF. In this article we will discuss “What is PF” and “What are the rules of PF”.

What is Provident Fund in 2023

PF means Provident Fund is also called Retirement Fund. People get this type of fund when they retire from their government or private jobs. Although it is not only available automatically, but for this also some paperwork has to be completed.

When a person starts working in a government or private company, where there is a system of deducting PF, then a small amount of money is deducted from the person’s salary every month and deposited in the provident fund account. And after the person retires, the same money is returned along with the interest.

After retiring from the job, a person has to go to the concerned Employees Provident Fund Organization office and complete the paperwork to get his PF money as well as to get PF pension.

Provident Fund is also called Social Security Fund. Please tell that PF is not deducted in every company. PF is deducted in a company in which the number of employees working is more than 20.  Then whether it is a government company or a private company. 12% of the basic salary + DA of a worker working in a government or private form is deducted as PF.

What is the full form of  PF ? 

PF: PROVIDENT FUND

The full form of PF in English language is Provident Fund and in Hindi language, Provident Fund is called Bhavishya Nidhi. Provident Fund is deducted from the salary of such workers who work in any government or private company in which the number of employees working is more than 20.

The provident fund is deducted from the person’s salary as long as he is employed and after retirement he gets the facility to withdraw all the money from the provident fund. Its other name is also EPF.

What is pf account number ?

Such government or private company which is registered with EPFO, the PF account of the people working in their company is opened by those companies, under which each worker is given a PF account number with a different number. This is an alphanumeric code. However, this type of number is not new.

When the job is changed by an employee, then the PF account number of that employee also changes. Apart from this, the employee also receives a UAN number.

But the way the PF account number of the employee changes after changing the job, in the same way the UAN number does not change, no matter how many jobs the person changes. His UAN number remains the same as it was earlier.

What is UAN number ?

Its full name is Universal Account Number. When you do your pension related action online after retirement from the job, then you need Universal Account Number to do your pension related action.

Through this, you can login to the PF account and access your PF account online, as well as carry out the process of action like checking the balance of EPF and withdrawing money.

Universal Account Number is a 12 digit number. The work of issuing it is done by EPFO ​​to every member employee.  If you have got Universal Account Number while working in a company and you leave that company and join another company, your Universal Account Number which you had earlier will remain the same. There will be no change in this.

In case of change of job, the member ID of the employee is changed and the new member ID received by him is linked with the Universal Account Number. However, there is one thing that the worker needs to keep his Universal Account Number active in order to take advantage of the online service.

You can get UAN number through your employer. If not, you can also search for your UAN number by login to the Universal Account Number Portal (https://unifiedportal-mem.epfindia.gov.in/memberinterface/) using your Member ID.

Types Of PF Account

Talking about provident fund account, it is of three types, which include types like Public Provident Fund, Employee Provident Fund and General Provident Fund. Let us give you information about all these three types below.

1: EPF

Its full form is Employee Provident Fund and it is called Employees Provident Fund in Hindi, which is a government organization. This scheme is made available to such people who do government job or get salary every month.

Under the Employee Provident Fund Scheme, any organization or corporation in which at least 20 employees are working should get themselves registered under this scheme.

According to the rules of the Employee Provident Fund Organization, an employee is required to contribute 12% of his basic salary every month, the same employer should pay a minimum salary of ₹ 15000 to the worker and 12% to the worker’s PF account. Contribution is required.

Under the Employees Provident Fund Scheme, 8.33% money goes to the Worker Pension Scheme and the remaining 3.67% is invested in the EPF. For your information, let us tell you that from the financial year 2022 to the year 2023, the interest rate of Employees Provident Fund is 8.10%.

2: PPF

The full form of PPF is Public Provident Fund. Public Provident Fund Account can be opened by any person who is a citizen of India. However, it is not necessary to open it. It depends on your wish whether you want to open Public Provident Fund account or not.

However, let us tell you that by investing your money in this for a long time, you can earn a lot of money. Under the Public Provident Fund scheme, you can deposit money annually for a minimum of ₹ 500 and a maximum of ₹ 150000. Its maturity period is 15 years.

When you open a Public Provident Fund account, after 7 years, you can apply to withdraw money whenever you want. At present, 7.1 percent interest is being received on the Public Provident Fund scheme. Interest keeps on changing from time to time.

3: GPF

Its full name is General Provident Fund. However, like other provident fund schemes, it is not for all workers, but only for those who are government workers.

Employees who are temporary government workers or who have worked for 1 year, all permanent workers and re-employment pensioners can apply for this scheme.

At least 6% of the employee’s monthly salary is contributed to the General Provident Fund scheme. At present, the rate of interest of 7.1% is running on it.

money deposited in pf account _ _

According to the Provident Fund Act, 12% of the basic salary and DA of an employee working in a company is sent to the PF account by that company. Along with this, 12% of the employee’s basic salary and DA is also contributed by the company.

In this way, out of 12% of the company, 3.67% is sent to the worker’s PF account and the remaining 8.33% is sent to the worker’s pension account. However, the condition here is that if the salary of a worker is less than 15000 then only he will get the benefit of Employee Pension Scheme. If it is not so, then 12% is put in the EPF fund itself.

Pros of PF

Let us know what are the benefits of PF or what are the advantages of PF or what are the benefits of PF.

1: Nominee making facility

If you work in a company through which PF is deducted from your salary, then you can make any person in your family a nominee of your PF. This happens that if the PF account holder dies, then in such a situation the one who has been nominated gets all the PF money.

2: Pension is received on EPF

Many people think that out of the money deposited in the provident fund account, can they transfer some money to the pension account as well, then tell that it is possible to do so. If this is done by you, then after a period of time under certain terms and conditions, you also become entitled to receive pension.

However, for this, you should be at least 58 years old and you must have worked in any government or private company for at least 10 years. If PF has already been withdrawn by you for 10 years, then in such a situation you will not get pension.

3: Insurance of 600000 is received.

If you work in a big company and provident fund is deducted from your salary by your company, then by default you also get insurance on your account. Under this, you get the benefit of Employee Deposit Link Insurance Scheme.

Under this scheme, ₹ 600000 is provided by the insurance company on the provident fund account of the employee. You can use the money received under this insurance to get your treatment done in the event of an illness or in the event of an accident or in the event of death.

In the event of death, the money of this insurance will be received by your nominee or your family members and in the event of illness or accident, this money will come into your account.

4: Interest is available on these active accounts

If your provident fund account has been active for more than 3 years, then even in such a situation you can get interest on that account.

However, for this, when you change jobs, you must get your PF account transferred at the same time, so that you can get interest on daily money, but if you do not do this, then it will be more than 5 years. You may have to pay tax while withdrawing money if the account is in active.

5: Better way of saving

Investing money in PF scheme is also considered a very good way to save, because when you deposit money in PF scheme then your money is absolutely safe. The way your money is likely to sink in other savings schemes, it does not happen in this.

Because all its work is looked after by the government. Interest is also given by the government on this, which keeps on changing from time to time. That’s why you can consider investing in PF scheme for long term investing.

6: Ease of withdrawal

According to the new rules, the government has given a lot of relaxation in the rules for withdrawing money from PF account. Now you can withdraw about 90% of the money from the provident fund account under some special circumstances or according to your financial requirement.

7:  Withdrawal of entire money after 2 months of leaving the job

If you have lost your job from the place where you work and after that even after 2 months have passed, you have not got a new job, then in such a situation, if you want, you can request to withdraw the entire money from your PF account. Can

If you do not want to withdraw the entire amount, then you can withdraw up to 75% of the PF money in advance.

You get the facility to withdraw 75% money after 1 month of leaving the job. There are some conditions in which you can withdraw all the money from your PF account after leaving the job. Like you are going to live abroad or you are getting married.

8: If you have worked for 10 years , you

will also get pension on retirement .

If an employee has completed 10 years of service and his pension has been made, then in such a situation the person starts getting pension after completing 58 years of age.

The person receives this pension every month. If an employee dies while in service, then in such a situation his family members get pension.

If an employee has completed the age of 50 years, then even in such a situation, he is entitled to receive pension earlier in a reduced amount. For the number of years before the completion of 58 years of age, you start the pension, the pension will be reduced by 4% for every year.

9: Receipt of Tax Exemption

You do not have to pay any kind of tax on whatever money is deposited in your PF account, because EPF has been kept in the category of tax exemption by the government.

However, remember that if you have worked for less than 5 years and the amount you are withdrawing from the provident fund account is more than 50,000 then TDS of 10% is deducted from your money. However, if you know that your income for the year is not that much to pay tax on it, then in such a situation you can get the TDS deduction stopped.

For this, when you apply for PF withdrawal, you need to fill and submit form-15g along with it. If you are doing the same process online then you are required to upload Form 15G online.

10: All PF accounts can be linked to the same UAN number

Any person who has a PF account is also provided with a Universal Account Number. The Universal Account Number you get for the first time becomes your Universal Account Number forever. No matter how many jobs you change, your Universal Account Number does not change.

All the pf account numbers you have are linked to the universal account number. Through this, you can transfer the money of all your previous PF accounts to the same PF account.

11: Work related to PF and pension can be done online from UAN portal

The UAN portal can be accessed through the internet from the comfort of home and all operations related to your provident fund account and pension can be completed online. To login to the UAN portal, you must have the UAN number as well as the password.

By doing this you will be able to login to the portal. After this you can check the balance of your PF account. You can transfer money from old PF account to new PF account, as well as withdraw PF money. Apart from this, you can use all the services related to pension and KYC through UAN portal.

How to calculate EPF interest rate ? _

Below we are explaining to you with an example how the interest rate of EPF is calculated. For this, we have given an example of an employee who has started contributing to EPF in the month of November in the year 2021.

Contribution start month:	November 2020
Interest rate (per annum):	8.5%
Monthly Interest Rate:	8.50/12 = 0.7083%
Employee Contribution:	12% of ₹ 15,000 = ₹ 1,800
Company Contribution:	₹ 1,800 (8.33% in pension, 3.67% in EPF)
Company’s actual contribution to EPF account:	3.67% of ₹ 15,000 = ₹ 550
Total monthly contribution to EPF account:	₹ 1800 + ₹ 550 = ₹ 2350

Now the calculation that will be done on the Employee Provident Fund account from the next month i.e. from the month of December will be as follows.

Balance from November 2021	₹ 2350
Interest earned in December 2021	₹ 16.75
Balance at the end of December 2021	₹ 2,350 + ₹ 2,350 = ₹. 4,700

When can I withdraw EPF ?

Sometimes such a condition arises in front of us that we need to withdraw money from our provident fund account midway. Below we have listed the reasons when you can apply for withdrawal from your provident fund account.

• own marriage
• marriage of children
• children’s education
• to cure illness
• For the treatment of illness of a family member
• pay off home loan
• building a house or repairing a house

PF rules ? 

According to the rule of provident fund, when a person works in a company, then both you and your company have to send 12% of your salary every month to the EPF account, after which your share 12% EPF is deposited directly into your account.

But out of 12% of the company, 3.67% is sent to EPF and the remaining 8.33% is sent to Employee Pension Scheme, which clearly means that if your monthly salary is around ₹ 50000.

 So according to its 12%, ₹ 6000 of your salary will be sent directly to your EPF account by your company and at the same time the company will also send 1835 to EPF account and the remaining ₹ 4145 to pension scheme.

It is necessary to link Aadhaar number with PF account

It has been ordered by the government that it is necessary for all PF account holders to link their Aadhaar number with their PF account. By doing this, you will get many other types of facilities along with EPFO.

If your Aadhaar number is linked with your PF account, then you will not face any kind of problem in withdrawing money or transferring money.

Under the new rule, if you have not yet linked Aadhaar number with your PF account or Universal Account Number, then you will not be able to use the service related to EPF account.

Apart from this, the company has also been barred by the government from depositing money in such PF account with which the account holder has not linked his Aadhaar card.

PF on Umang App

Through the UMANG application , you can also get the benefit of many facilities related to the Provident Fund. On the Umang application, you get a chance to take advantage of different types of provident fund services.

You can easily download UMANG application in your mobile from internet or Google Play Store and visit PF portal from mobile. Following are the 5 different sections related to PF on UMANG Application.

1: Employee Centric Services  

• passbook viewing service
• claim facility
• Claim Tracking Facility
• Facility to get information through Establishment ID
• Get TRRN Status

2: EPF General Services      

• establishment search
• EPFO Office Search
• Claim Status Checking
• Account statement on SMS
• Account statement on missed call

3: Pencil Holder Service

• view passbook
• Update Jeevan Pramaan

4: eKYC Services    

• aadhaar linking

pf customer care number

Through this article, we have tried to provide you maximum information related to PF, but still if you want to get any kind of information related to PF account, then you can establish contact on PF customer care number i.e. PF toll free number. Can Below we have given information about PF toll free number and head quarter of PF in front of you.

1800118005 (Toll Free)

Head Office:
Provident Fund Building,
14, Bhikaji Cama Place,
New Delhi – 110066

So friends hope that now you have got all kinds of information related to PF and PF account, and you must have known what is PF? Its types, interest rates and terms? (Provident Fund )

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