EPFO: People often withdraw the entire amount of their Employee Provident Fund (EPF) after leaving the job. But do you know that withdrawing the full amount of the PF account can be a loss-making deal for you? Due to this, huge funds and savings are being created for your future end. Also, there is no continuity of pension. It would be better to join the new company or merge it with the old one.
Let us tell you what happens to your PF account and the amount deposited in it after leaving the job.
EPFO: Interest is available on PF even after leaving the job
According to experts, even if the employees leave the job or are fired due to some reason, you can still leave your PF for a few years. If you do not need PF money then do not withdraw it immediately. Interest on PF continues to accrue even after leaving the job and it can be transferred to a new company as soon as new employment is available. PF can be merged in the new company.
The company provides this facility for three years
Explain that PF account interest is available for 36 months i.e. 3 years after leaving the job. Here it is important to know that for the first 36 months if there was no contribution for the first 36 months, the PF account of the employee was put in the category of Inoperative Account. In such a situation, you have to withdraw some amount before three years to keep your account active.
Interest earned on PF amount is taxable
According to the rules, the PF account does not become inactive if the contribution is not made, but the interest earned during this period is taxed. If the claim is not made even after the PF account is inactive, then the amount goes to the Senior Citizens Welfare Fund (SCWF).