Saturday, April 1, 2023
HomeFinancePF Account Holder: 5 benefits of PF account that you should know...

PF Account Holder: 5 benefits of PF account that you should know about

Free insurance and pension are among the various other benefits that Employees’ Provident Fund Organisation (EPFO) extends to its members.

The Provident Fund, which is mandatory for every employee who fulfills Rs 15,000 threshold for monthly PF contribution, is generally considered a retirement-oriented investment option.

Under Section 80C of the income tax act, an employee gets income-tax exemption on a PF contribution of up to Rs 1.5 lakh in a financial year. The Employees’ Provident Fund Organisation (EPFO) provides various other benefits to its members.

Here are 5 PF account benefits

 Loan against PF:

A PF account holder can take a loan against their PF balance and the PF loan interest rate levied is only 1 percent if there is a financial emergency. Within 36 months of loan disbursal, the loan has to be repaid.

 Free insurance:

Under EDLI scheme, in case of death during the service period, a PF account holder by default becomes eligible for free insurance up to Rs 7 lakh. Previously, the death cover was Rs 6 lakh. Under the EDLI scheme, the PF account holder need not pay any insurance premium for the death cover.

 Home loan and hole loan repayment:

One can withdraw up to 90 percent of the PF balance for buying a new home or constructing a home, as per EPFO rules. So, PF account can be used for home loan repayment and through PF balance, one can buy land as well.

 Partial withdrawal during an emergency:

Subject to some terms and conditions, in case of medical or financial emergency, EPFO allows partial withdrawal.

Pension provision:

A PF account holder is eligible for pension after 58 years as well. However, to become eligible for the pension, there has to be a minimum of 15 years of regular monthly PF contribution in one’s PF account. The pension benefit comes from the employer’s contribution as 8.33 percent of its contribution (out of 12 percent) goes to the EPS account of the PF account holder.

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @
- Advertisment -

Most Popular

Recent Comments