Overcoming 3 Common Misconceptions About Employee Provident Fund
Blog: NASSCOM Official Blog
Professionals nowadays are only bothered about spending hours on the workstation, reaching a higher position in the hierarchy and making huge bucks. But little do they know about the basics of corporate workflow and the SOPs being followed in an organization to the core. You can look around, hear and observe the kind of interactions people have about trivial yet significant matters like payroll/ salary break-up and how confused they are about the small facts.
Be it the objective of the firm, the company policies or their own KRAs, there are always those people confused about what’s going on and don’t know the complete reality of how things work. There is always some misinformation or wrong statement being spread about the functionalities that end up becoming what everyone believes. But as it is said, “a little knowledge is a dangerous thing”, the myths need to be busted.
So, it’s time to start with talking about one of the most common misconceptions regarding salary deductions, i.e., Employee Provident Fund and revealing the correct information to overcome the same. Let’s focus on some lesser-known facts about EPF like online PF withdrawal, applicability, and eligibility for EPF among others:
MISCONCEPTION ONE
Every working professional must pay for EPF
A large number of working professionals believe that they have to compulsorily get their share deducted from the salary only because they are employed. NOT TRUE! There are eligibility as well as applicability criterion based on which EPF operates. Let’s see how:
Applicability:
Every organization that has a strength of more than 20 working employees has to register for the EPF scheme.
Eligibility:
Employees who earn monthly wages of INR 15,000 or less have to pay for the EPF contribution. Others have the option of paying or not as per their will.
MISCONCEPTION TWO
Withdrawing EPF is a complex task
Gone are the days when employees had to stand in long queues, wait for hours and get a huge amount of paperwork done in order to check PF balance or withdraw it. But, with the advent of technology, online PF withdrawal has become a cakewalk. It’s literally just a few clicks away! You have to sign up on the official EPF website or EPFO e-SEWA portal and enter your UAN (Universal Account Number) and password to log in. Now, you can enter the same credentials every time you want to check the particulars.
MISCONCEPTION THREE
Employees can only withdraw PF after retirement
This is one of the most common myths that employees have because of the term ‘retirement’ attached to the name of this regime – EPF Retirement Scheme. But, unlike what most people believe, there is no hard and fast rule that it can be withdrawn only at the time of retirement. Although not completely, there are multiple scenarios where one can partially withdraw his/ her EPF amount online or offline such as Marriage, Education, Medical Treatment, Loan Repayment and for several other reasons.
Source: Overcoming 3 Common Misconceptions About Employee Provident Fund
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