In this post, I tried to answer some of the most frequently asked question regarding PF (Provident Fund) act. Hope this post will help you to get some of your concern regarding said Act. I would suggest that you should go through my post Fundamentals of PF act in India to get a fair idea about PF act first. I would appreciate if you share other queries in your mind through comment section so that I can add them in my upcoming post which will be continuation of this post.
FAQ 1 : Do employee joining a new company should be made member of PF, if he exceeds PF prescribed limit i.e. Rs 6500/-?
- You need to get Form 11 signed from employee, in which employee will give declaration about his membership in PF in previous company.
- Also company should have a policy in place to support above mentioned actions.
FAQ 2: Do we need to continue PF membership of employee whose wages become more than 6500/- after increment?
FAQ 3: Can an employer reduce wages of an employee, in relation to PF contribution?
FAQ 4: In my company, numbers of employees are less than 20. Can we also take volunteer PF Code and start contribution?
FAQ 5: There is some ambiguity whether to deduct PF on some of the salary components like arrear, Notice Pay, Leave Encashment etc or not?
FAQ 6: Principal employer is liable to pay Provident fund of contractual employee?
FAQ 7: Do Part time, Employee engaged through contractor, Trainee and Apprentice comes under PF act?
FAQ 8: Do education institutions comes under PF Act?
FAQ 9: Can I withdraw my previous company PF after joining some other company?
FAQ 10: Can I withdraw money from PF in between? If yes, for which cases?
1. Marriage or education of self, children or siblings
- You should have completed a minimum of seven years of service.
- The maximum amount you can draw is 50% of your contribution
- You can avail of it three times in your working life.
- You will have to submit the wedding invite or a certified copy of the fee payable.
2. Medical treatment for Self or family (spouse, children, dependent parents)
- For major surgical operations or for TB, leprosy, paralysis, cancer, mental or heart ailments
- The maximum amount you can draw is 6 times your salary
- You must show proof of hospitalization for one month or more with leave certificate for that period from your employer.
3. Repay a housing loan for a house in the name of self, spouse or owned jointly
- You should have completed at least 10 years of service.
- You are eligible to withdraw an amount that is up to 36 times your wages.
4. Alterations/repairs to an existing home for house in the name of self, spouse or jointly
- You need a minimum service of five years (10 years for repairs) after the house was built/bought.
- You can draw up to 12 times the wages, only once.
5. Construction or purchase of house or flat/site or plot for self or spouse or joint ownership
- You should have completed at least five years of service.
- The maximum amount you can avail of is 36 times your wages. To buy a site or plot, the amount is 24 times your salary.
- Can be avail of it just once during the entire service.
FAQ 11: How to file RTI to get update on PF withdrawal or transfer status or PF balance?
FAQ 12: What is VPF (Volunteer PF)?
FAQ 13: What is EDLI (Employee Deposit linked Insurance)?
FAQ 14: Can Employer take insurance policy from insurance company to substitute EDLI?
FAQ 15: What is the interest we get on PF?
FAQ 16: Provided Fund contribution is taxable income?
FAQ 17: Do expats need to contribute to PF?
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