We bring fantastic news to our friends. The Employees’ Provident Fund Organization (EPFO) has introduced an important update that will affect over 60 million account holders. If you are one of the PF account holders, you must be aware of these developments.
You will get a complete analysis of EPFO New Rules with relevant additions in this post, as well as just how they affect the provident fund from contributions, withdrawals, and many more.
Mandatory KYC Update
Most importantly, it makes KYC mandatory for all EPFO account holders. Lack of updated KYC may not allow you to contribute or withdraw the following activities: Update PAN Card, Aadhaar, Bank Details, etc. Employers have been instructed to ensure their employees complete the KYC process without any delay.
New Stricter Withdrawal Rules
With the EPFO New Rules, it is going to be increasingly strict on withdrawal processing. The verification will be done online and there will be very strict timelines for withdrawing advance amounts. To eliminate frauds, all such requests will now be subject to digital scrutiny regarding each such withdrawal. This ensures as much transparency and security as possible for your hard-earned money.
New Tax Rules
Here’s a new one for you to be careful: if your withdrawal exceeds Rs 2.5 lakh, then you will be subjected to TAX under new rules from now on in withdrawals from the PF accounts. It has a major impact on those employees who frequently change jobs. Moreover, withdrawal of Rs 5 lakh and above will be taxed for the higher band. It also looks significant for those who would like to withdraw bigger amounts from their PF accounts.
- KYC Update: Just make sure your KYC details have been updated to avoid any interruptions in contributions or withdrawals.
- Withdrawal Guidelines: The online verification and digital review will be more stringent.
- Tax Implications: Any withdrawal beyond ₹2.5 lakh will invite taxation and also at a higher rate for withdrawals above ₹5 lakh.
- Pension Cheer: Retired people will increase their pension amounts now.
- Interest Rate Stable: The EPF interest rate remains steady at 8.15% for 2023-2024.
Enhanced Pension Scheme
Good news for pensioners! This new EPFO rule is expected to benefit people by enhancing their pensions. Many pensioners will see an increase in their pension amounts now, thus giving them relief from the burden after retirement. Also, special provisions have been made for employees with less than 10 years, giving them better social security.
Stable Interest Rates
Stable and steady EPF interest rate for this financial year 2023-2024 is 8.15% to date, remaining flat from previous years as EPFO continues to strive for it as central to the retirement funds of its account holders.
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