EPFO: If you are also a PF account holder, then you get insurance of Rs 7 lakh for free, along with many more benefits will be available on the account. So let’s know everything about them…
New Delhi. Employees’ Provident Fund Organization (EPFO) provides PF facility to all employees. For this, a small part of the salary of the employee is deducted for depositing in the PF account. This is a way of securing the future of the employee after his retirement. After retirement, this deposited capital comes in handy for that employee. But do you know that not only in old age but PF account holders get many more benefits from this account. So let’s know everything about them…
1. Facility of free insurance is available
As soon as an employee’s PF account is opened, then he also becomes insured by default. Under Employee Deposit Linked Insurance (EDLI), the employee is insured up to Rs 7 lakh. In case of death of an active member of EPFO during the period of service, up to Rs 7 lakh is paid to his nominee or legal heir. Companies and the central government provide this benefit to their employees. Recently, the maximum benefit under this scheme has been increased from Rs 6 lakh to Rs 7 lakh.
2. Tax exemption is available
On the other hand, even if you want tax exemption, PF is the best option. However, you should also know that there is no such facility in the new tax system, whereas tax exemption is available in the old tax system. EPF account holders can save up to 12 percent in tax on their salary under Section 80C of Income Tax.
3. Pension is available after retirement
Out of the contribution deposited in the PF account, 8.33% goes to the employee pension scheme. Which is received in the form of pension after retirement. Pension is the biggest support for a person’s old age. For which the government also runs many schemes.
4. Interest on Dormant Account
Interest is also paid on the inactive PF account of the employees. According to the changes made in the law in 2016, now interest is also paid to PF account holders on the amount deposited in their PF account lying dormant for more than three years. Earlier, there was no provision to pay interest on PF account lying dormant for three years.
5. Money can be withdrawn at the time of need
Another great feature of PF fund is that some money can be withdrawn at the time of need. This will save you from the possibilities of loans.
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