Provident Fund (PF) is being considered by EPFO to increase the interest rate. Currently, the interest rate on provident fund (PF) is 8.65 percent. Currently, 12% of your current basic salary goes to the provident fund. The company also offers 12 per cent, in which 8.33 per cent is deposited in your pension scheme (EPS) account and the remaining 3.67 per cent in EPF. Apart from this, there are many benefits of PF, which are telling you further.
First Benefit: Insurance Up to 6 Lakhs
You might not know that by default insurance is available on your account. Under the EDLI (Employee Deposit Linked Insurance) scheme, insurance up to Rs 6 lakh is available on your PF account. Under this scheme the account holder gets a lumpsum payment. It can be availed at the time of any illness or accident and death.
Second Benefit: Pension After Retirement
In the event of depositing money in a regular PF account for 10 years, you also get the benefit of employee pension scheme on your account. If an account holder stays in the job continuously for 10 years and continues to have a deposit in his account, then under the Employee Pension Scheme 1995, he will continue to get one thousand rupees as pension after retirement.
Third Advantage: in These Situations Can Withdraw Money
Often, people withdraw money from a PF account while changing jobs. This is because people feel that money cannot be withdrawn from the current account. It is not, in some situations you can withdraw money from your PF account. However, during this time you can withdraw only a certain amount. To buy or build a house, for loan repayment of house, in sickness, for higher education of children, for marriage of girl. However, to avail these benefits, account holders are required to be members of EPFO for a certain period of time.
Fourth benefit: Interest will Also Be Available on Inactive Accounts
The EPFO had also decided to pay interest on accounts lying dormant last year. However, this did not happen earlier. Now, interest will also be available on such PF accounts which have been lying dormant for more than 3 years. Actually, the accounts in which there is no transaction for 3 years are put in the category of inactive accounts. Now such accounts will also get interest. Therefore, you should get your PF account transferred as soon as you change your job. This will earn interest on your regular amount. If you do not do this, according to the rules, in the event of the account being inactive for more than five years, it will have to pay tax at the time of withdrawal.
EPFO, EPFO, PF, Provident Fund, EPF
Fifth Benefit: PF Account Will be Automatically Transferred
Transferring PF money has become easier now. You can keep more than one of your PF accounts (in case of job change) through your UAN (unique number) link to Aadhaar. There will be no need to fill Form-13 to claim EPF money on joining a new job. EPFO has recently released a new Form-11, so that your previous account will be automatically transferred to the new account.