Home loan repayment- If you want to withdraw money from your EPF for home loan repayment, then you must be in service for at least 10 years.
Employee Provident Fund is prepared for post-retirement planning. This fund is a good savings plan especially for those working in the organized sector. But, on the occasion of some important expenses, part of this fund is taken out even before retirement. The Employees Provident Fund Organization (EPFO) allows the withdrawal of funds for home loan repayment, marriage, education, medical emergency, home purchase or renovation before retirement. However, it has some rules. You should know these rules.
Understand before withdrawing home loan repayment
If you want to withdraw any amount from your EPF for Home Loan Repayment, then you must be in service for at least 10 years. There will be some terms and conditions for this withdrawal. Firstly, the home loan for which you are withdrawing money, the home loan has been taken jointly in the name of you or your spouse or both. For this withdrawal you will have to submit the required documents to EPFO. You can withdraw at least 36 months basic salary and dearness allowance. It will also include the contribution of the employee and the employer and the interest on it.
Rules for buying land or building a house
You can also withdraw some part of the Employee Provident Fund to buy a house or to buy land to build a house. For this, you will have to remain in service for at least 5 years. The house or land to be purchased must be jointly registered in the name of your name or spouse or both.
What is the rule for marriage and education?
You can take out some part of EPF before retirement for marriage of your brother or sister or children. You can also withdraw from this fund keeping in mind the expenses incurred for higher education of your children. This fund can be withdrawn only after the child passes 10th.
As per the EPFO rules, 50 per cent of its total contribution can be withdrawn in the name of marriage or higher education before retirement. For this, you have to keep in mind that you have been in service for at least 7 years. Meanwhile, if you have changed your job, you will still be eligible for this withdrawal. Overall, you will be allowed to withdraw from this fund only after working for at least 7 years.
Suppose there is a total contribution of 4.5 lakh rupees in your EPF, which is 5 lakh rupees along with interest. In such a situation, you can withdraw up to 2.5 lakh rupees in the name of marriage or higher education. You will be eligible for this withdrawal only 3 times till retirement.
How to withdraw your provident fund?
One can apply online for withdrawal of Provident Fund. You can also apply through a form by going to the local EPFO office. To withdraw some part of the fund, you have to fill a self attested form. To fill the online form, you will have to apply by visiting the official website of EPF. Your Universal Account Number (UAN) must be activated on this website. Also, it should have Aadhaar, Permanent Account Number (PAN) and bank account link.
Should PF be withdrawn before retirement?
Every month employees and employers deposit a fixed amount into this fund. Experts believe that this fund should not be withdrawn before maturity. Because, this can increase the risk after retirement. In such a situation, if you buy a house with the help of Retirement Fund for retirement or use it for any other expenses, then financially weak life after retirement. Banks are always ready to give loans in times of need. Especially banks have many types of offers for education or buying a house. But, no bank gives loan for planning after your retirement. In such a situation, you can secure your post-retirement life through EPF. EPF is an amount in which compounding is also provided.
