Big News for EPFO Account Holders! Not withdrawing PF after changing job can benefit you with an interest up to 3 years, know details
EPFO- even after leaving a job or getting fired, one can still let interest brew in the PF account for a few years.
Withdrawing the full amount of PF account after leaving a job can be a loss. This can lead you to lose a huge fund or saving being created for your future ends. Also, it stops the continuity of your pension. However if you have a job change, it is rather beneficial to link the benefits with the old account than to create a new one.
Even after retirement, if you do not need money, then you can leave PF for a few years.
Interest gained in PF account even after leaving job:
According to the sources, even after an employee leave the job or is fired for some reason, they can still leave their PF for a few years.
If you do not need PF money then do not withdraw it immediately. Even after leaving a job, an EPFO account holder still keeps getting interest adding on to their PF value. However the account can then be transferred to a new company as soon as the new employment is available. PF can be merged in the new company.
Facilities provided by the company for three years:
Interest on PF account is available for 36 months i.e. 3 years after leaving the job. It is to be noted that if there is no contribution made in the account for the first 36 months then the PF account of the employee will be considered as an Inoperative Account. In such situation, one will have to withdraw some amount before three years to keep your account active.
Is interest earned on PF amount is taxable?
As per the rules, the PF account does not become inactive if no contribution is made, but the interest earned during this period is taxed. On the other hand, if one wants to claim the amount even after the PF account is inactive, the amount will go to the Senior Citizens Welfare Fund (SCWF).
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